One of Jadwa’s primary areas of focus is private equity investments. With the strength of our own balance sheet and the participation of our clients, we focus on investing in privately held companies with reputable partners, strong market position, and great potential in their respective sectors. So far, Jadwa, along with its investors, have invested over of SAR 5.4 billion in 10 private equity transactions.
Jadwa’s private equity investment philosophy rests on the following three guiding principles:
1. We invest in partnerships, not companies: we believe that the value of any company stems from the full alignment and commitment of its shareholders. Accordingly, we look to invest with reputable partners, based on a spirit of full partnership, alignment, and mutual trust.
2. We are long-term investors: we invest patient capital in private equity opportunities with great long-term potential. Accordingly, we approach our investments with a disciplined mindset and long-term commitment to our partners.
3. We add value in our areas of expertise: we are highly committed to supplementing and supporting our partners in our core areas of competence, including corporate governance, strategy, finance, business development, and IPO readiness. By extension, we do not seek to replace management teams or assume management responsibilities as we do not believe this falls within our areas of expertise.
We are committed to adding value to our partners in order to achieve the company’s long term objectives. For example, we have taken the lead on two successful IPOs of our portfolio companies, Al Hokair Group and Al Hammadi Company for Development and Investment, as well as the sale of Gulf Union Foods Company to Olayan Financing Company through a trade sale.
Our value addition to a private equity transaction is focused on five distinct areas:
Corporate governance: We support implementing corporate governance best-practices, including board and committee formations, definition of governance roles and responsibilities and introduction of reporting and control processes. Additionally, we actively participate on boards and board committees.
Strategy: We review, validate and develop the management’s business strategy, as well as supporting the effective execution of developed strategies and business plans. Furthermore, we identify organic and inorganic growth opportunities in local and international markets.
Corporate finance: We support the management in optimizing the company’s capital structure, securing favorable financing arrangements and structuring and negotiating Merger & Acquisition (M&A) transactions.
Management: We support management in identifying and recruiting senior staff as needed, as well as structuring management incentive plans.
Business development: We leverage our extensive network for business development purposes, including the identification and development of business partnerships and alliances.