DUBAI, June 25 (Reuters) - Samena Capital, the largest shareholder in Abu Dhabi-listed RAK Ceramics, is looking into potential divestments at the tile and ceramics maker to help to improve its performance, it said on Wednesday.
Shirish Saraf, vice-chairman of Samena, said RAK Ceramics had a lot of growth potential because of the construction boom in the Gulf and rising consumption in Africa and Asia. RAK is one of the world’s largest makers of floor tiles and other ceramic products.
Saraf also said there was potential to generate improvements in the company’s performance by getting out of “non-core” areas, without giving specifics.
“I think the attention of the last two years of the board and management has been on the core business and, over time, Samena can possibly look to unlocking value in the non-core business as well,” Saraf said, adding there were a number of options including sales and bringing in investors into these fringe businesses.
These were the first public comments about Samena’s plans for RAK since it completed the purchase of a 30.6 percent stake earlier this month for an undisclosed fee.
Saraf said Samena Capital planned to hold its investment for between three and five years, and while it had no specific target for internal rate of return (IRR) it usually looked for between 25-30 percent on any investment.
Samena also wanted to improve the profile of the company among stock market investors to help boost liquidity in the shares, Wassim Moukahhal, a senior vice president at the fund, said.
Most days, RAK Ceramics trades under a million shares a day - on Tuesday, 200,000 shares changed hands. Its market value was $712 million, according to Thomson Reuters data.
Samena, which currently has around $870 million of assets under management, hopes to close two further investments in the next three months, Saraf said, declining to elaborate further.
Reporting by David French; Editing by Jane Merriman