NIG Prospectus - London Stock Exchange

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Level: 8 – From: 8 – Thursday, August 9, 2007 – 2:19 pm – mac5 – 3776 Section 07 : 3776 Section 07NIG’s principal strategic investments outside Kuwait as at 31 December 2006 were as follows:Country ofYear ofOperations111112Stake (%)111112investment111112InvestmentSaudi International Petrochemical Company(SIPCHEM) ............................................................ Saudi Arabia 8.00 1999National Industrialisation Company (Tasnee) ............ Saudi Arabia 5.00 2000Egyptian Kuwait Holding Company .......................... Egypt 5.25 1997Kuwait Syrian Holding Company .............................. Syria 10.00 2002Iraq Holding Company .............................................. Kuwait 4.2 2003Kuwait Jordan Holding Company .............................. Jordan 10.00 2004Jordan Telecom ........................................................ Jordan 10.00 2006Dana Gas .................................................................. UAE 2.3 2005Karachi Electric Supply Company.............................. Pakistan 28.6 2005Investment Policies and Risk ManagementIn 2004, NIG, in co-operation with KPMG, implemented a complete set of investment policies,which include guidance and procedures for risk management. These are closely followed for bothlocal and international investments. Investment reports are presented to the InvestmentCommittee at their weekly meetings. The Investment Committee is committed to complying withNIG’s defined investment thresholds and approval protocols.MAJOR SHAREHOLDERSAs at 31 December 2006, NIG’s share capital was KD 107 million comprising 1,070.3 millionshares of 100 fils nominal value each. NIG benefits from a strong and stable shareholder base.Approximately 30 per cent. of NIG’s shares are held by major institutional investors, 29 per cent.are held by prominent Kuwaiti trading families, including the Al-Khorafi, Al Rabia, Al-Rashid, Al-Saad, Al-Fulaij and Behbehani groups whilst the rest are largely held by the general public. Theshares of NIG are traded on both the KSE and the DFM.The only two shareholders who own in excess of 5 per cent. of the total outstanding shares areKuwait Cement Company (8 per cent.) and Public Institute of Social Security (5 per cent.).INSURANCENIG believes that it has all the necessary insurance policies for the operation of its businesses andthat each of its subsidiaries (whether local or international) which need insurance cover havesatisfactory cover.INFORMATION TECHNOLOGY (IT)Currently, NICBM’s IT department also services NIG’s IT requirements. NIG is in the process ofconstructing a new head office in Kuwait and intends to provide a new integrated IT system forthis office. NIG expect to invest up to US$1 million on this system in the next six months. Thissystem will also improve NIG’s back-up systems, which will be located both in a separate buildingto the head office and off-site.REGULATIONNIG is committed to complying with the requirements of the numerous regulatory bodies whichimplement the laws and regulations which apply to NIG, including the KSE, the Dubai FinancialMarket and the Ministry of Commerce and Industry.82
Level: 8 – From: 8 – Thursday, August 9, 2007 – 2:19 pm – mac5 – 3776 Section 07 : 3776 Section 07INTERNAL AUDITInternal audit functions are performed by NIG’s central internal audit unit. This unit hasimplemented an audit manual which applies to each of NIG’s subsidiaries, unless that subsidiaryhas outsourced its internal audit function to a local audit firm (which, in order to ensureindependence, cannot be NIG’s usually appointed external audit firm), which is the case for NICBMand Noor. Each subsidiary’s accounts are reviewed by NIG’s internal audit unit on a quarterly basis.The findings of the internal audit unit are reported to the board of directors on a quarterly basis. Inaccordance with the KSE’s requirements, NIG submits its unconsolidated interim financialstatements within 45 days of the end of the relevant financial period. Each of NIG’s subsidiarieshas its own compliance procedures. NIG’s compliance procedures are approved by the Ministry ofCommerce and reviewed by the Central Bank of Kuwait on a yearly basis.DIRECTORS, MANAGEMENT AND EMPLOYEESThe following chart sets out the management structure of NIG:Board of DirectorsGreen Field InvestmentsChairman & Managing DirectorGeneral ManagerInternalAuditHuman Resources&AdminstrationGroup FinancialControllerDirectInvestmentsLocalInvestmentsInformationTechnologyShareRegistryPrivate EquityInvestmentsInternationalInvestmentsHumanResourcesFinancialAccountingLocalSubsidiariesManagedInvestmentsPrivate EquityInvestmentsAdministrationManagementAccountingForeignSubsidiariesEquityInvestmentsManagedInvestmentsTreasuryAssociatesCash/BankPayrollNIG’s articles of association provide that it shall be managed by a board of directors consisting ofnine members elected by the shareholders at the general assembly meeting. The term of boardmembership is three years, subject to renewal. The board may appoint directors, including thechairman, to serve as managing directors of NIG whose duties and responsibilities are determinedby the board.The current chairman of the board of directors is also the managing director. A general managerreports to the managing director and is responsible for the day-to-day management of theCompany through a team of executive managers.The board of directors has one committee, the investment committee which consists of threedirectors. The Investment Committee develops, monitors and enforces the investment strategy ofNIG and any potential investments by NIG’s subsidiaries which exceed US$50 million must beapproved by the Investment Committee.83
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NIG Prospectus - London Stock Exchange

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