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Family firm goes from strength to strength

The Kharafi groupís activities include major construction projects.

RECOGNIZED as one of the world’s leading business personalities, Nasser Muhamed Al-Kharafi puts no limit on his ambitions for the international conglomerate that he heads. As the Chairman of M.A. Kharafi & Sons, he would like to see the family-owned, multi-sector group—current turnover approximately $4 billion—double, or even treble, in size.

With roots in Kuwait going back more than 100 years, the Al-Kharafi group is active in virtually every sector of the emirate’s economy. Its interests range from engineering and construction, agribusiness and food industries, finance and banking to manufacturing and industry, real estate, infrastructure, tourism, leisure, and hospitality.

Kharafi is one of the largest contracting groups in the Middle East and a major player in BOT (build-operate-transfer) schemes in the region, but its activities extend much further, to South Africa and Europe.

“Since Kuwait is a very small market, the only way of developing the group was to go international and take risks, as well as assuming the huge potential of the regional market,” explains Mr. Al-Kharafi. “First we ventured into other Gulf countries—Saudi Arabia, the United Arab Emirates—and then to Egypt and on to South Africa.”

The group has established a track record for handling major projects. In Kuwait itself, it recently completed the new Sulaibiya sewage treatment plant, the largest reverse osmosis complex in the world. The $447.5 million facility will provide for 26% of Kuwait's overall water demand. It was built in partnership with the U.S. company Ionics—one of a number of partnerships undertaken by Al-Kharafi with American companies.

“They have equity with us and we bought technology from them for the reverse osmosis process,” says Mr. Al-Kharafi. “The project was finished three months ahead of schedule and has been a great success.”

Chairman of M.A. Kharafi & Sons

The group is also building the new Al-Shaikh Jaber Al-Ahmed International Stadium, to the south of Kuwait City. Due for completion next year, the KD 55 million ($190 million) hi-tech stadium will be equipped to stage the biggest regional and international sports events before 60,000 spectators.

Mr. Al-Kharafi believes there are many opportunities for American companies in the region.

Through its subsidiary company, Americana, the largest food company in the Middle East, the Al-Kharafi Group owns the franchise for Pizza Hut, Kentucky Fried Chicken, TGI Friday's, Hardees, and several other U.S.-based fast food chains in the region. The consumer goods it produces include Heinz Ketchup and Cadbury’s chocolate. Americana has reached annual sales of $1 billion dollars through 600 outlets in 11 Arab countries.

“We started with Wimpy and then it developed into Kentucky Fried Chicken, Hardees, and Pizza Hut,” recalls Mr. Al-Kharafi. “We went into the industry convinced of what we were doing.”

The Al-Kharafi group is one of the largest foreign direct investors in Egypt, with assets and investments totaling approximately $1.8 billion. Its most recent projects include the new Marsa Alam International Airport—Egypt’s first successful BOT transportation project, for which it holds a 40 year concession—and the Port Ghalib International Marina.

The conglomerate is the largest single shareholder in the Marsa Alam Tourism Development Company (MATD), which is developing the 12-mile stretch of Red Sea coastal land in which Port Ghalib lies.

The conglomerate is involved in reconstruction in Iraq through its Kharafi National company, which provides engineering, construction and maintenance services to the petroleum, chemicals, power, water and commercial industries. Kharafi National is working as a subcontractor for a subsidiary company of Halliburton on a U.S. Army-awarded contract to rebuild Iraq’s oil infrastructure.
The National Bank of Kuwait, in which the Al-Kharafi Group owns an estimated 16%, is part of a consortium of banks that is rebuilding the banking market in Iraq.

Recent activities further afield by Al-Kharafi companies include the building of hotels, tourist villages and a holiday resort in Albania, and the development of a $200 million golf and residential estate in South Africa.

“Our group has been very active overseas for a long time,” says Mr. Al-Kharafi. “That’s where our capacities lie. It makes sense to go to developing countries. They are the perfect places to find abundant opportunities.”