Listing family businesses to give added value to KSE - Economists
Analysts have agreed that the recent call by Chairman of the Board of Commissioners of Kuwait's Capital Market Authority (CMA) Nayef Al-Hajraf for family businesses to list at the Kuwait Stock Exchange (KSE) is a significant step that is likely to give added value to the market.
In separate interviews with KUNA, they cited the financial solvency and accumulated expertise of family businesses, saying this will help realize the vision of turning Kuwait into a regional financial hub, enhancing the flow of national and foreign investments. Listing of family businesses on the KSE will be a remarkable step, advisor to the Board of Directors of Arzaq Capital Co. Salah Al-Sultan told KUNA on Monday.
Yet, he believed that the present stage is "unfavorable", citing the frequent declines in market performance since the global financial mayhem, and its implications.
The pace of market performance since the year started has been impacted by pressing factors, which prompts family businesses to wait until some temporarily risks vanish, he said.
These risks are mainly political developments in the region, the falls of oil prices and the lack of major market makers at KSE, he noted. Al-Sultan stressed the fact listing family businesses in the region's second strongest market will no doubt consolidate it, and give impetus to efforts seeking to develop Kuwait into a financial hub in the region.
Analyst Adnan Al-Duleimi referred to favorable positive factors for family businesses to be listed at KSE, topped with their good investment reputation. These also include the CMA Law that regulates businesses and helps them maintain their status, he added, noting that the state had offered these companies financial, legislative and logistic support, as well as saving many of them from bankruptcy.
Meanwhile, Al-Duleimi told KUNA that the activation of the CMA Law pushed some companies that had withdrawn from the market to think seriously of making a comeback.
No doubt listing family businesses on the KSE will have several benefits for the market and the companies, chairman of the Kuwaiti Traders Association Mohammad Al-Tarrah. The step will boost the financial solvency of the businesses so that they can expand their activities for the good of shareholders, Al-Tarrah told KUNA.
The listing of the Mezzan Holding Co. on KSE earlier this yearhas been successful, which prompts the "cloning" of similar family businesses.