The Middle East's 40 Largest Public Companies

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Forbes.com
The Middle East's 40 Largest Public Companies
By Paul Maidment

Tuesday, December 04, 2007

The Middle East invokes different regions to many people. British diplomats in the 19th century who first coined the term thought of the Levant, Palestine and Egypt as the Near East and of India and China as the Far East so the Middle East was Arabia, Persia and the other bits in between.

It is still an imprecise area that generally encompasses the lands around the eastern and southeastern shores of the Mediterranean and on either side of the Gulf, stretching as far as Turkey to the north, Afghanistan to the east, the Sudan to the south and Morocco to the west.

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But it is the fact that it is the area where Europe, Africa and Asia meet, creating a trade crossroads that also connects to the overlapping Islamic, Arab, Persian and Turkish worlds, as well as many pockets of ancient ethnicities and religions, that colors the composition of our first annual listing of the 40 largest publicly traded companies in the Middle East. That, and the fact that the region sits atop two-thirds of the world's known oil reserves.

Financing trade, oil and the offshoots of the wealth that both create explains why banks dominate our list, taking 15 of the 40 spots, including five of the top 10: Turkey's Turkiye Is Bankasi, Akbank and Turkiye Garanti Bankasi, Saudi Arabia's Al Rajhi Bank and Israel's Bank Hapoalim.

The next largest industry group is telecom companies, of which there are seven, including Saudi Telecom and Egypt's Orascom Telecom, followed by oil and gas companies, numbering five, of which Tupras-Turkiye Petrol is the largest. Those three industries collectively account for two-thirds of the list.

The largest publicly listed company in the region is the Saudi chemicals giant, Saudi Basic Industries Corp. (SABIC). It is one of the world's leading manufacturers of chemicals, fertilizers, plastics and metals, with annual sales of $23 billion. The company was founded in 1976 to turn waste natural gas from crude oil extraction into petrochemicals products and is now the world's third-largest producer of polyethylene, with half its sales going to Asia.

Earlier this year it won the auction for former GE Plastics with $11 billion, greatly expanding its U.S. operations. This followed the acquisition of the U.K.'s Huntsman Petrochemicals last year. It is currently investing about $20 billion a year in expanding capacity.

SABIC is majority owned by the Saudi government and its chairman is Prince Saud bin Thunayan Al-Saud. One caveat to our list: Much of the corporate wealth in the region is concentrated in royal or government hands, often one in the same. That is one reason that the country supplying most companies to our list, No. 15, is Turkey, followed by, with No. 9, Israel, both parliamentary democracies.

It is also the reason that there is no company, like Dubai Ports World, from any of the small states of the Arabian peninsula, some of the region's richest and most economically dynamic but where state investment agencies such as the Kuwaiti Investment Agency and Dubai International Capital are portfolio investors.

There is a joke in the chemicals industry that SABIC really stands for "seriously big industrial chemicals company." It ranks 157th on our listing of the world's 2000 largest public companies.

That list, like this, scores companies on a composite of four measures of corporate bigness: sales, market value, assets and profits. We do this because a list based on a single metric, like sales, would be lopsided with retailers, or financial firms if assets were the measure.