Interview: Syed Mustafa, VP - logistics Almajdouie
Can you tell us about the significant milestones in the business in 2011 and Q1 of 2012?
Why are we in the media? Because I believe Almajdouie is dominant in logistics, and this does not date from today; it’s, I would say, right through the forty-eight years we have been in the industry. Saudi Arabia has the largest economy in the Middle East, so there’s a lot of work there and we have been very successful in getting some major projects. Last year, we transported the world’s largest bullet tanks. That was a record. The second achievement was in Abu Dhabi, in Shuwaihat, when we moved the world’s largest evaporator weighing collectively 4600 tonnes. Then came 2012 when we moved an even bigger evaporator in Saudi Arabia – the heaviest load to be transported in the Middle East: it weighed 4891 tonnes. There are so many other achievements. I would say, something like 300 units moved in different parts of Saudi, Kuwait, Qatar and Abu Dhabi.
Just how big is Almajdouie?
We are the largest project operator in Saudi Arabia and the largest transporter in the Middle East. And, when it comes to petro-chemicals logistics, we are the largest in Saudi Arabia, because our market share is actually more than seventy per cent. What I usually say is 65 per cent, because I feel shy, actually, and I don’t want other people to feel bad. The private sector and the handling of almost all Aramco’s business of petro-chemicals has made us number one.
So the firm’s market share is 75 per cent in Saudi Arabia in petro-chemicals?
We handle 74.6 per cent. That’s our share. The other companies have about 25 per cent and there are around three other major companies. But, their share may increase a little bit in 2013 or 2014, because they will have projects coming up where we will not be involved. For only one reason, because we have so many projects starting at the same time, it was not possible to get involved. But I still don’t think our share will drop much!
Beyond Saudi Arabia, where else are you looking? What other projects do you have?
Okay. Beyond Saudi Arabia, of course, the GCC is our focus area. We are operating in Jebel Ali. We don’t only do projects, but we’re also into warehousing and other supply chain management solutions. Also Abu Dhabi and Kuwait, but exclusively for certain projects. In Jebel Ali, it is for mainly the warehousing and supply chain, shipping, forwarding, packaging, but from time to time we also get involved in some other projects. In Oman, we have a partner, so when there is anything that comes up, we just move there or can mobilise the equipment out of the UAE. So I think this year and most probably for another two years, until maybe 2014, our focus will remain in the GCC.
So after 2014, it is a global expansion?
We are also working on other areas and getting involved in other countries as well. We’ll not be limited to Saudi Arabia, because in Saudi Arabia we are very, very strong. Sometimes opportunities come and we go. Like two years ago, we had a project where we went to India; we handled all the big pieces and come back. So, we are not limiting ourself to GCC, but the concentration is the GCC. And that’s what we want to see, we want to grow, and increase our share, but I personally don’t believe in growing very fast because that makes your base weaker. So we are moving gradually, but I believe the speed of growth is quite fierce. We are lucky that in the Gulf countries they have been investing a lot of money in oil and gas, and other infrastructure projects that have been helping us grow.
Is it true that Almajdouie plans to merge together under one brand?
We have five companies or six companies doing different businesses connected with the supply chain, so we’ve decided to merge and become one entity. The company will be headed by the president, then I will be CEO plus chief operating officer. By merging them, the one advantage is that we will be marketing under only one name and be offering total supply chain management. At the same time it will be a company worth more than a billion riyals, in terms of revenue and assets. So that’s why we’ve decided to merge into a new company - Almajdouie Logistics. The process of merging will start from July, and continue for the next six months.