Business valuations need specialization, efficiency and proven independence. They are essential for various business and strategic decisions such as acquisitions, divestitures, mergers, IPOs, restructuring, converting closely-held or family businesses into shareholding companies.

Valuation services are amongst the core activities of AlShall, where value is through provision of independent and reliable recommendations about the value of a business through implementing the most suitable methodologies.

Over the past 10 years, AlShall has carried out more than 100 business valuations using different techniques and procedures. A number of those businesses included some of the most sophisticated businesses ranging from family-owned businesses to large capital shareholding companies. It is a testimony to AlShall that to date, it did not face major problems from the results and the consequences of the valuation assignments it has carried.

 

Project Example – Privatization.

Assignment

  • Privatization of local marketing operations of KNPC (fuel stations and oil blending plant).

Client Name

Privatization Committee led by Kuwait Investment Authority with Kuwait Petroleum Company.

Client’s Activities

Governmental – Public Sector.

Assignment Date & Duration

2002, 15 months.

Main Area of Focus

Review of old studies and data gathering

  • Prepare RFPS and qualification criteria to assign specialized third party consultants

  • Select sub-contractors

  • Develop privatization strategy that included:
    – Pricing strategy (gross margin)
    – National labor force
    – Number of companies
    – Ownership structure of these companies
    – Basis of allocation of the fuel stations to these companies
    – Regulatory supervision requirements upon privatization
    – Valuation of companies

Services Provided

Held role of lead advisor to the committee for fuel stations and oil blending plant privatization.

  • Valued operations

  • Set-up an implementable privatization process

  • Presented findings to Privatization Committee and Higher Oil Council

Outcome

The fuel stations and oil blending plant were subsequently privatized in line with AlShall’s recommendations.

Project Example – Financial Restructuring.

Assignment

Preparing a corporate level strategy to restructure the debt and assets of an investment company (balance sheet restructuring).

Client Name

Kuwaiti investment company.

Client’s Activities

Leasing, finance and investment.

Project Size

  • Debt obligations size for restructuring: ~USD 125 million (contractual debt) and ~USD 50 million (other obligations)

  • Assets size for restructuring: ~USD 265 million (mostly real estate investment properties)

Assignment Date & Duration

2012, 3 months.

Main Area of Focus

Restructure company’s indebtedness (local debts) and investments with the aim of primarily: i) restructuring paying-out its defaulted financial obligations in full, ii) restructuring its assets-base, and iii) avoiding liquidation (or bankruptcy). The objective is to keep the company operating on an ongoing basis and restoring its profitability with an ultimate goal of protecting shareholders’ wealth.

Services Provided

Review, analyze and assess the company’s financial position and assess its liquidity base and solvency position.

  • Identify and assist in determining the fair value of the assets to be used in the debt restructuring plan and especially those to be collateralized.

  • Review the existing strategy and assist in developing a realistic strategic plan to serve the company’s goals and guide it in its corporate debt restructuring plan.
    o Assist in setting strategies to ensure the settlement and closing of debt claims from all creditors and other related parties claims while preserving and protecting shareholders wealth.
    o Assess and propose a debt restructuring plan and prepare debt restructuring schedules accordingly.
    o Assess and estimate future cash flows under the context of a corporate debt restructuring plan.

  • Propose an out-of-court Corporate Debt Restructuring (CDR) plan with alternative scenarios to be presented to creditors.

  • Assist the client in negotiations with creditors, especially the most senior creditors (in terms of size of outstanding debt and collateral) in order to reach an understanding on a CDR plan scenario acceptable to all stakeholders prior to resorting to protection under Kuwait’s Financial Stability Law (“FSL”) No. 2 of 2009.

Outcome

The company received approval to enter under FSL Law based on the CDR plan developed by AlShall.