Double win for Investcorp with US and Saudi deals

The Bahrain-based firm has agreed to buy US-based Paper Source, while its Gulf-focused team has picked up a 30 percent stake in Saudi Arabia’s Theeb Rent A Car.

Investcorp has completed two deals in a day, acquiring Paper Source, a US supplier of high-end gifts, stationery and craft products, and picking up a 30 percent stake in Saudi Arabia’s Theeb Rent A Car through its Gulf Opportunity Fund. Financial details for both transactions were undisclosed.

Investcorp bought Paper Source from
Brentwood Associates, a Los-Angeles-based private equity firm. Headquartered in Chicago, Paper Source operates 73 stores across 23 states, selling artisanal papers, personalised gifts, gift wrap and greeting cards. Investcorp said it planned to expand the company’s store base, direct marketing activity and e-commerce presence.

Meanwhile the Theeb deal marks the tenth investment by Investcorp’s $1 billion Gulf Opportunity Fund, and its fourth in Saudia Arabia. Theeb is the second-largest car rental company in Saudi Arabia, employing 900 people and operating a fleet of more than 10,000 vehicles. A family business, it has delivered more than 17 percent growth in both revenue and net income over the last three years and is targeting double-digit growth over the next five years.
“We are enthusiastic about this partnership and about the company's growth prospects, given its leading position in a sector estimated at circa $1 billion and which has witnessed double-digit growth over the last five years,” Investcorp managing director Walid Majdalani said in a statement. Investcorp would now take “an active role” on Theeb’s board, the firm said.

Investcorp’s recent investments in Saudi Arabia include Leejam Sports Company, a health and fitness club operator, and Al Yusr Industrial Contracting Company WLL, a provider of technical industrial support services mainly to the petrochemical, oil & gas sectors. Last year, its Gulf Opportunity Fund successfully exited from its first investment in UAE-based Redington Gulf.