MUSCAT, Oct 31 (Reuters) - Oman’s State General Reserve Fund (SGRF) agreed to buy 32.2 percent of Mecanizados Escribano, a family-owned Spanish company making precision mechanical components for the aerospace, defence and other sectors, the sovereign fund said on Monday.
The deal is part of a drive by Oman to use its sovereign fund assets to help diversify the economy beyond oil and gas exports; under the deal, Escribano will set up a local manufacturing entity in Oman, although details were not given.
SGRF will invest in Escribano through a combination of an equity purchase from the current owners and a capital increase to finance new development projects, the fund said in a statement.
Angel Escribano, president of the Spanish firm, told Reuters that the company’s capital currently totalled 50 million euros ($55 million) and with the new partnership, “We will be acquiring other companies related to our line of operations.”
The partnership aims to raise the company’s capital to 500 million euros, focusing its research and development activities in Spain while establishing manufacturing operations in the Gulf, SGRF’s executive president Abdulsalam al-Murshidi said.
“We expect the business to grow by 25 to 30 percent every year,” he told reporters, without giving further financial details of the acquisition. (Reporting by Fatma Alarimi; Editing by Andrew Torchia and Louise Heavens)
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