Frank Kahn and Hassan Najjar: An analysis of the Aras Group
Dubai – Who are Frank Kahn and Hassan Najjar? That’s the question. All over Europe clients are asking about the Aras Group.
The European start-up scene can not complain about its financial
resources. This is the conclusion of the half-yearly published „Start-up
Barometer Europe“ by the consulting firm EY. According to the October
2018 survey, the number of financings increased in the first half of
2018 compared to same period last year across Europe by 19 percent to
almost 2,000 deals. The total value of these financings grew even more:
In the first six months of the year, deals totaling 10.2 billion euros
were made in 2018 – 27 percent more than in the same period of the
previous year. In view of the number and value of the financing rounds,
we can speak of a veritable investment boom in the European start-up
scene.
According to the EY study, in the first half of 2018, most
start-up financing in the UK was ahead of France and Germany. In Great
Britain, the number of deals increased by 23 percent compared to the
same period of the previous year, by 11 percent in France and by only 3
percent in Germany. Not only in terms of the number of financing rounds,
the British island is ahead of Germany, but also in the financial
volume of the deals. In the period under review, financing in the amount
of 3.1 billion euros was made in the United Kingdom. Germany follows
with 2.4 billion euros in second place ahead of France with an
investment volume of almost 2.0 billion euros. It is also interesting
that London, Berlin and Paris have remained the hotspots of the European
start-up scene: around 31 percent of the financing rounds in European
start-ups were recorded in these three major cities. In addition to
Berlin, Munich, with ninth place, is the second German city to reach the
top 10 in Europe.
However, the capital flows are very unevenly
distributed and obscure the view of the still large capital requirements
of some start-up sectors. EY partner Peter Lennartz says: „Most
recently, young e-commerce companies in particular benefited from the
current investment boom in Germany and the high willingness of investors
to invest.“ Technology start-ups, on the other hand, still find it
difficult to obtain fresh capital.
In fact, many startups still
struggle to raise the much-needed risk capital for their business ideas
because banks refuse to lend. This is where Frank Kahn comes into play,
who is supposed to maintain the best contacts with wealthy families from
the Gulf States and works as key account manager for the Aras Group DWC
LLC. The Dubai-based company is active in the areas of equity
investments, commodities trading, management consulting, logistics,
investments and real estate. The global network includes Aras Investment
and Participation Ltd., Aras Logistic and Distribution Ltd., Aras
Trading and Services Ltd., Aras Consulting and Advisory Ltd. and Aras
Properties Ltd.
In the German-speaking area, Frank Kahn is on the
look-out for start-ups that are eligible for funding and that can make
good use of venture capital for their growth. This money from Dubai has
already helped several innovative start-ups, for whom neither bank loans
nor an IPO for self-financing came into question. The Aras Group claims
to provide venture capital in the hundreds of millions. The project
financiers from Aras can draw on these financial volumes because they
work closely with various partners in the financial services industry.
Aras Financial Specialist Ibrahim Saadi explains how this works with
venture capital provided by his company: „The value of the Aras Group’s
risk loans is in the tens of millions to hundreds of millions in most
cases, even though Aras is not a bank, but an investor. Through a
subordinated loan agreement, which in the meantime also meets the
requirements of the German BaFin, the investments make the Aras Group a
silent partner in the respective company. In this way, large-scale
projects can be financed in a transparent and cost-effective manner, and
there are no restrictions on the location and industry of the
credit-seeking company.“ Saadi also points out that the capital receiver
concludes the financing agreement directly with the Aras Group and not
with the respective active refinancing company. „Basically, the Aras
Group wants to achieve through financing by investors, that a financing
alternative to the classic bank loan can be used“, adds company
spokesman Hassan Najjar. „In addition, another goal is to create a link
between Arabia and Europe, so that more and more European companies can
use the financing options.“
The group of companies claims to have
more than 110 highly qualified employees who receive several project
financing applications every day. Specially trained finance teams assess
the seriousness, sustainability and profitability of the projects and
evaluate all available information to make an informed judgment about
the chances of success. Only if this preliminary examination turned out
positively, the Aras experts discuss the financing possibilities with
the project carriers in familiar round. If the communication and
business plan is then, the customer gets paid the project funds in
tranches.
From 20 October 2020 to 10 April 2021 Dubai will host the
World’s Fair, which is already a financial catalyst and a major economic
factor. The motto is „Connecting Minds, Creating the Future“, and the
Expo site is divided into the three zones „Opportunity“, „Mobility“ and
„Sustainability“. The organizers expect 25 million visitors, of which
about 70 percent come from abroad. Around 190 states have agreed to
participate. It can be assumed that a globally oriented project
financier like the Aras Group will benefit from the fact that Expo 2020
will focus on Dubai.