Multi-sector investments

Key trends

Key industry trends across all multi-sector entities in the Middle East are as follows:

Sovereign wealth funds
  • Allocating a larger portion of their portfolio to direct investments with a more active investment approach
  • Adopting a global approach to investments across emerging and developed markets
  • Developing an appetite for alternative investment classes such as infrastructure and real estate
  • Balancing economic development and financial returns mandates
  • Focusing on specific investment themes in line with their country’s economic and development vision
  • Setting up deal sourcing and co-investment partnerships with other institutional investors or private equity firms
  • Institutionalizing policies and processes (e.g., portfolio management) in line with best practices
  • Improving governance and transparency in line with best practices and Santiago principles
  • Developing best-in-class corporate capabilities across the investment life cycle with deep portfolio management expertise

Client examples

Pan-Arab sovereign investment company portfolio turnaround
A Pan-Arab GCC-focused joint-stock company that conducts equity investments and wholesale lending engaged Strategy& to develop a five-year strategic business plan.
Local direct investment strategy for a GCC sovereign wealth fund
Changes in consumer behavior, driven by new technologies, are profoundly reshaping the TV and video ecosystem. Most of the future growth in viewership will take place on new screens like PCs, tablets, and smartphones, and through new, nonlinear video formats, while social media will rise in importance.
Multi-sector/Family-owned conglomerates
  • Focusing their portfolio on core activities where they can leverage their differentiated capabilities, while aiming to divest or turn around underperforming businesses
  • Expanding core operating businesses into new geographies or adjacent sectors while leveraging strategic and operational synergies
  • Developing partnerships and joint ventures with international industry leaders to set up or enhance operations in local markets
  • Monetizing investments and generating liquidity through minority sale of assets (e.g., to private equity firms) or listing a subsidiary
  • Redefining their corporate management role and level of involvement vis-à-vis portfolio companies
  • Institutionalizing business activities by segregating them from family services and assets
  • Enacting best-in-class corporate and family governance frameworks to address ownership and oversight challenges during transition to subsequent generations
  • Developing best-practice functional capabilities at the holding level to support the group and portfolio companies in executing core and support activities
  • Professionalizing corporate governance with formal committees, independent directors, and a detailed delegation of authority across the organization .

Client examples

Multi-sector portfolio strategy for a new geography
Due to slowing growth in its core business and excessive exposure to the distribution of one brand, a leading MENA-region family conglomerate was searching for diversification opportunities.
Corporate strategy and governance model for family-owned conglomerate
Changes in consumer behavior, driven by new technologies, are profoundly reshaping the TV and video ecosystem. Most of the future growth in viewership will take place on new screens like PCs, tablets, and smartphones, and through new, nonlinear video formats, while social media will rise in importance.
Investment portfolio restructuring and operating model review
A leading GCC investment company, asked for Strategy&’s help to design a formalized investment strategy and operating model.
Private equity companies
  • Creating dedicated opportunity funds targeting specific sectors or geographies with deep industry capabilities
  • Expanding geographic scope to new emerging markets including Africa and South East Asia
  • Focusing on sustainable value creation from existing assets when exiting investments in the next five to seven years will be difficult
  • Strengthening corporate capabilities to improve portfolio management and value creation
  • Setting up co-investment partnerships with other PE players or institutional investors to improve deal sourcing capabilities
  • Considering a wider range of funding sources including mezzanine and debt financing

Client examples

Commercial due diligence for a leading regional private equity player
The private equity arm of a large international bank wanted to acquire a stake in a company dealing in the tissues and diapers markets in the MENA region.
Assessing investment opportunities in the GCC healthcare and education sectors
Changes in consumer behavior, driven by new technologies, are profoundly reshaping the TV and video ecosystem. Most of the future growth in viewership will take place on new screens like PCs, tablets, and smartphones, and through new, nonlinear video formats, while social media will rise in importance.
Family principals
  • Developing a family governance structure that maintains the family unity and balances the potentially divergent views of family members
  • Establishing formal family offices to provide various services to family members, including wealth management, concierge, education support, and philanthropy
  • Professionalizing the family service delivery model to optimize service levels at the lowest possible cost
  • Gaining alignment on a set of principles and values regarding family and ownership matters
  • Enforcing agreed-upon governance mechanisms through local regulations that may not have the required flexibility
  • Identifying alternative sources of wealth creation beyond core businesses to maintain an acceptable level of income and wealth for a growing number of family members
  • Supporting next-generation development through education, entrepreneurship ventures, or employment opportunities

Client examples

Single family office feasibility assessment and business model
A high-net-worth European family engaged Strategy& to define the optimal business and operating models for its single family office (SFO).
Family group constitution and shareholder agreement
Changes in consumer behavior, driven by new technologies, are profoundly reshaping the TV and video ecosystem. Most of the future growth in viewership will take place on new screens like PCs, tablets, and smartphones, and through new, nonlinear video formats, while social media will rise in importance.

How we help our clients

Corporate/Investment strategy

  • Integrated business plan and strategic growth options
  • Investment strategy including:
    • Investment focus (e.g., across asset classes, sectors, and geographies)
    • Portfolio structure and risk management approach
    • Business model and financial forecasts
  • Investment approach in deal sourcing, value creation, and monetization
  • Strategic target setting

M&A and corporate finance

  • Portfolio assessment and restructuring plan
  • Divestment planning
  • Acquisition screening and commercial due diligence
  • Post-acquisition restructuring and merger support
  • IPO preparation support

Corporate operating model

  • Holding-level organization structure design
  • Definition of corporate management role
  • Business unit structure definition o Capability gap assessment
  • Corporate governance and authority matrix design
  • Management processes design

Family governance and family offices
(specific to family principals)

  • Family governance design
  • Family office business model and setup
  • Family charter development support
  • Ownership planning support