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APICORP Increases Subscribed Capital to $ 1.5B

Source: 5/31/2011, Location: Middle East

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In a strong endorsement of its performance from member states, the Arab Petroleum Investments Corporation’s (APICORP) Extraordinary General Assembly meeting held in Cairo on Sunday unanimously decided to increase the Multilateral Bank’s subscribed capital by 173% from US$ 550 million to US$ 1,500 million. APICORP is owned by the ten member states of the Organization of Arab Petroleum Exporting Countries (OAPEC).

An extraordinary meeting of the Bank’s General Assembly also resolved to double its authorized capital from US$ 1.2 billion to US$ 2.4 billion. In addition, APICORP’s paid-up capital was increased 36% from US$ 550 Million to US$ 750 Million by capitalizing retained earnings of US$ 200 million into 200,000 shares distributed pro rata to member shareholders. This is the highest such distribution since the founding of APICORP, 35 years ago.

Ahmad Bin Hamad Al-Nuaimi, Chief Executive and General Manager of APICORP said: “The capital increase reflects the confidence of member states in APICORP’s ability to catalyse growth and value creation in the region’s oil and gas industry. While the increased capital will contribute to our target of doubling our direct investment portfolio by the end of our current five year plan, from a more long-term strategic perspective, it gives us the ability to significantly expand our investment and financing horizons and our role in the sector. We would like to express our appreciation to APICORP’s shareholder states for their steadfast commitment to APICORP’s core mission of transforming the Arab world’s energy industry. Their support has considerably helped APICORP in proactively exploring opportunities for supporting oil and gas projects that can add value to both the energy sector and the region’s economy.”

Shareholder states have previously supported APICORP with three capital increases in 1981, 1996 and 2003. In 2008, shareholders pledged US$ 1 billion in deposit facilities.

“Furthermore, APICORP’s shareholders have waived receiving dividends consecutively for the last three years including 2010, which is akin to injection of capital, and that demonstrates the shareholders unwavering support to further bolster the Corporation’s capital base,” Al-Nuaimi added.

The latest capital increase follows the announcement of APICORP’s 2010 annual results, which saw the Multilateral Bank’s annual net profits surging 62% from 2009 to reach US$95 million. Total assets for the period rose to US$4.3 billion, a 5% increase over their 2009 levels of US$4.1 billion while total shareholders’ equity rose by 13% to reach $1.1 billion. Meanwhile, at the end of the first quarter of 2011, APICORP recorded a net income of US$39.3 million, while total assets and total shareholders’ equity reached US$4.42 billion and US$1.16 billion respectively.

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