Carlyle Group - Gadaffi and Monkey Business

As Lord Patel has previously noted, on 1st October it was announced that the shady Carlyle Group had bought Tamoil for US$3Bn from the even shadier lady, Gadaffi and Libyan Gubment Oilinvest, Libya's foreign oil investment arm. Tamoil was acquired by Oilinvest (Netherlands) B.V. part of Oilinvest, in 1988.

Tamoil refines, markets and sells the country's oil, and has around 3,000 petrol stations in Italy, Germany, the Netherlands, Switzerland and Spain, with a further 150 in Africa where they have a presence in Egypt, Chad,Niger,Burkina Faso,Mali and Eritrea. Tamoil famously has a Euro 110 Mn ( a year) sponsorship deal with Italian Football club, Juventus until 2010 - Gadaffi's son was until recently a Director of Juventus.

It is claimed that less than a third of Libya has been explored for oil. The country’s estimated reserves of 37 billion barrels put it among the top ten potential oil exporters. Current output is said to be 1.6 million barrels per day (bpd) which could dvelop to over 3.0 million bpd by 2010.

Details of the deal (or confirmation that it has happened) have not been divulged by either party although the private equity world is full of gossip. This deal (and the need some say to seal it) has resulted in a sign of a major shift in the Carlyle Group investment policy . The D.C.-based private equity firm has hired Walid Musallam, former CEO of the Abu Dhabi Investment, to lead a new Middle East and North Africa (MENA) team as managing director.

The group will operate from offices in Cairo, Egypt; Dubai, United Arab Emirates; and Istanbul, Turkey, Carlyle will invest in a variety of sectors, including energy, financial services, health care, industrial, technology and transportation.

"Carlyle's global network and industry expertise are great differentiators that will benefit growing Middle Eastern and North African companies," Musallam says.

Musallam is a heavy mover and has also been CEO of Middle East Capital Group, a merchant bank based in Beirut, Lebanon (their website still shows him as CEO) He also was founder and CEO of D.C.-based Infrastructure Finance Group, with wide expereince on financing, acquisitions and dealing with governments on restructuring and privatizing state-owned facilities.He has also managed several construction projects in the Middle East.

Mr Musallam served as senior investment officer at the International Finance Corp. in D.C. and a vice president at Lehman Bros. in New York. He has managed several construction projects in the Middle East.

The very well connected and secretive outfit evidently senses a change in investment opportunities in the area - changes and opportunities that seem fairly remote to some observers.

It is interesting to read Mr Musallam in the Daily Star , Beirut 5/7/03 on the Al Jazeerah website "Why Americans support the war on Iraq" ...for example

"...how does it (the US Gubment) justify the war for Iraq where the regime was known for its antagonism toward fundamental Islam and there was no proof of a link with Al-Qaeda or the events of Sept. 11 let alone the failure to find any weapons of mass destruction? "

Popular views on the Beltway - from a man who it says was working for the World Bank.