Investcorp portfolio company L’azurde announces dividend of $16.7 million
Investcorp, the asset management firm specialising in alternative investments, today announced that its portfolio company L’azurde, one of the world’s top five gold jewellery manufacturers, has distributed $16.7 million in dividends to its shareholders, following a strong performance in 2014. The Investcorp Gulf Opportunity Fund acquired a majority stake in L’azurde in 2009 alongside Eastgate Capital and The National Investor, its consortium partners. After the gold price shock in 2010, a new strategy for the business was developed with the objectives to strengthen its operations and ensure it was positioned to maximise its growth potential, while being insulated from difficult market conditions and gold price volatility. Since that time, L’azurde has been steadily increasing its earnings, achieving double digit year-on-year growth.
Mohammed Al-Shroogi, Investcorp, President of Gulf Business, said: “Our clear performance improvement strategy for L’azurde has reorganised and repositioned the Company. We have enhanced its market positioning, increased its competitiveness and strengthened its balance sheet. This strategy has improved L’azurde’s financial performance steadily over each of the last five years. Today the Company is highly profitable and this has allowed the Board to declare and distribute a dividend to shareholders of $16.7 million for 2014.”
The consortium partners, working with a new and highly experienced management team, undertook a number of business improvement strategies including enhancing sales coverage, product design improvement, cost reduction, renegotiating bank facilities and working capital optimization as well as the roll-out of advanced management information systems. In addition, the marketing spend was recently increased to include several renowned brand and collection ambassadors such as Elissa, Lady Fozaza and Dorra Zarrouk. The consortium also put in place a corporate governance framework in line with international standards.
Selim Chidiac, Chief Executive Officer of L'azurde, added: “L’azurde has made very good progress in recent years underpinned by increased gold sales which have risen to 17.5 tons in 2014 from 12.9 tons in 2011. With strong product lines, improved market share, wider distribution networks and strong marketing presence, the Company is very well-positioned for the future. We have excellent business momentum and a strong team and remain confident that we can continue to build on our solid growth trajectory.”
Founded in 1982, L’azurde has become the largest gold and jewellery designer, manufacturer, and distributor in the Middle East, with facilities in Cairo and Riyadh, employing over 2,300 people. Its sales network comprises 2,000 wholesale accounts across the Middle East. It also has 15 retail stores across the region.
L’azurde has also received a number of certifications and awards such as the British Standards Institution (BSI) in Occupational Health and Safety (OHSAS 18001:2007); The Gold Virtuosi International Award for design excellence in gold jewellery in Italy; the International Quality in Gold Jewellery Award by the Trade Leaders’ Club in France; and the London Bullion Market Association accreditation amongst others.
Investcorp made its investment in L’azurde through the Gulf Opportunity Fund I, the inaugural fund from Investcorp's Corporate Investments MENA, launched in 2007. In addition to L’azurde, two other Saudi portfolio companies of the Gulf Opportunity Fund, Theeb Rent a Car and Leejam (owner of the Fitness Time brand) recorded strong performance in 2014, and distributed dividends to their shareholders.