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UBICO is a joint venture financial institution between Abu Dhabi Fund For Development, a 100 per cent Emirate of Abu Dhabi owned development financial institution, and the Government of Bangladesh with 60:40 ownership basis.
Abu Dhabi Fund also provided financial assistance to various projects in Bangladesh such as the Teesta Barrage, East West Interconnector Power Line, Machine Tools Factory at Gazipur and Chittagong Urea Fertilizer Plant.
UBICO was incorporated as a private limited company in June 1997 with a mission is to invest in socio-economic development projects of Bangladesh.
Activities of UBICO are aimed at attaining the following objectives: (a) To make investment in financially viable projects of sectors of the Bangladesh economy on commercial basis and marketing of their products, goods and services in Bangladesh and abroad; (b) To be involved in the promotion, formation, management, operation and financing projects in Bangladesh; (c) To establish subsidiary companies, involve or participate in the equity capital, or loan capital, or both of other existing companies or corporations in collaboration with local entrepreneurs which may help to promote economic cooperation and advancement of financially viable projects; (d) To underwrite, purchase and merchandise share, stocks, bonds, debentures and other securities of financially viable projects or companies or corporate bodies either directly or through or jointly with one or more financial institutions; (e) To make advances and provide loans and working capital to financially viable projects in Bangladesh; and (f) To underwrite, subscribe, manage and distribute the issue of bonds, debentures and other securities either directly or indirectly with one or more institution.
Present portfolio:
UBICO has already provided financial assistances to various industrial projects in Bangladesh. The RMG sector has received 40.38 per cent of this assistances, capital machinery and infrastructure development sector 34.07 per cent, and health care and medical sector 25.55 per cent. Out of the total investment, term loans comprise 20.36 per cent, lease finance 11.07 per cent and equity 68.57 per cent.
UBICO has the primary mission to create a solid foundation for value creation. That is why with its strong financial back up, UBICO looks for a long-term perspective through proactive ownership participation in a professional manner.
UBICO has started a compatible system to monitor performance of local corporate houses as well as sectors as a whole. Main purpose is to consolidate the documented information and analyse the same to use effectively to form an investment decision or to identify potential areas for value growth and list of measures that are required to achieve this growth.
For each potential new investment an analysis of the goals and realisation of value appreciation is done. This includes an analysis of the possible forms of future exit. Investments are essentially sector independent and are assessed on a regular basis. Active ownership requires major resources and clarity of focus. That is why UBICO allows first priority on equity financing though in a limited scale and prefers to have at least one directorship seat on the company's board.
In general, each investment evaluation covers the following main areas: a) Value potentials i.e. business model, growth, profitability and value creating measures; b) Market opportunities i.e. organic growth for the market and the company; c) Strategic positioning, i.e Strategy, acquisitions or divestment; d) Capital rationalisation i.e. Dividend, reduction of capital, stock buyback, refinancing, working capital; and e) Operational improvement i.e. cost cutting, market position etc.
UBICO has adopted a systematic investment process with the main goals:
- to have a clear picture of performance of the company it has invested,
- to act swiftly when business opportunity arises, and
- to create a highly efficient organisation at a low cost
Social responsibility
UBICO strives to be a good citizen by accepting the responsibilities that is, inherent in an active ownership role. Only in harmony with society in general can long term growth in value be created. Like other companies, UBICO works in a world in which companies are expected to be aware of their social impact based on environmental, economic and social factors. UBICO strives continually to maintain its social responsibility of business ethics, respect for the individual and its commitment to environmental, health, safety and civic concern.
Environmental responsibility
UBICO ensures that the companies in which it has major investment, adopts environmental policies based on their respective business conditions with emphasis on the following area: a) The market - the companies shall be responsive to customers performance and to the market's environment; b) Environmental impact - the companies shall be aware of their environmental impact and work actively to reduce this impact and their use of resources; c) Legislation - legal requirement should be followed proactively; d) Environmental Management - targets must be quantifiable and followed up on a regular basis.
Corporate governance
The corporate governance system of UBICO prefers in a simple and functional manner. Corporate Governance is based on existing rules, regulations and laws of Bangladesh and as per Memorandum and Articles of Association of the company.
Activities of the company are well regulated, controlled and monitored by Bangladesh Bank as non-banking financial institutions (NBFI) under the Financial Institution Act 1993 and its subsequent progress.
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