MUSCAT: In a strategic move aimed at promoting growth, improving credit ratings, and driving profitability, the Oman Investment Authority (OIA) — the integrated sovereign wealth fund of the Sultanate of Oman — has successfully restructured and reduced the debts of its national companies. Following the transfer of ownership to the OIA, this initiative has yielded significant positive outcomes, positioning the companies for future success.
In a post, the OIA, over a span of two years, has achieved a remarkable 23.4% reduction in corporate debt. This reduction demonstrates the Authority's commitment to financial stability and long-term sustainability. By addressing and resolving outstanding debts, the OIA has created a solid foundation for its companies to thrive and attract investment opportunities.
As part of the debt reduction strategy, a total of RO 3 billion in debt has been paid off, including the prepayment of RO 600 million. This proactive approach not only improves the financial standing of the companies but also enhances their creditworthiness, enabling them to access favorable financing options for future growth and expansion.
Looking ahead, the OIA has set ambitious goals for debt repayment in 2023. A staggering RO 900 million in debt is scheduled to be paid ahead of their due dates, demonstrating the Authority's commitment to meeting financial obligations promptly. By proactively managing and reducing debts, the OIA is ensuring the financial health and stability of its portfolio companies, fostering an environment conducive to sustainable growth.
Moreover, as part of the debt restructuring efforts, the OIA has successfully secured the release of a government guarantee worth RO 231 million on a loan for one of its companies. This achievement not only reduces the financial burden on the company but also instills confidence in potential investors and stakeholders. The release of the government guarantee reflects the OIA's commitment to facilitating a favorable business environment and supporting the growth aspirations of its companies.
The successful debt reduction and restructuring initiatives undertaken by the OIA have far-reaching implications for Oman's economy. By improving the financial health of its companies, the OIA is fostering an environment that encourages investment, entrepreneurship, and innovation. As a result, the companies under OIA's ownership are better positioned to seize growth opportunities, create employment, and contribute to the overall economic development of the country.
In its latest annual report OIA posted a remarkable return of 8.8% on its investments. It also noted that it provided RO 5.6 billion to the state general budget over the past seven years (2016-2022), which averages to around RO 800 million ($2.1 billion) annually.
Oman Observer is now on the WhatsApp channel. Click here
