Losses mount to US$485m at Bahrain's state fund

Losses at Bahrain's government investment company more than doubled last year as it restructured some of its holdings and the economic slump hurt key businesses.

Bahrain Mumtalakat Holding Co said losses increased to 183 million dinars （US$485.4 million） from 69 million dinars （US$183 million） a year earlier.

Mumtalakat is a holding company mostly focused on state-run businesses in the tiny Gulf island nation. It said it has spent much of the past year restructuring operations and tweaking its strategy.

"I would characterise 2009 as a year in which we took an inward-looking approach to prepare for the future," chief executive officer Talal al-Zain said in a statement.

The global downturn particularly hurt business at its money-losing airline Gulf Air and at Alba, an aluminium smelting company, it said.

Gulf Air, one of Bahrain's most visible companies, last year hired the former head of Royal Jordanian Airlines as chief executive officer in an effort to revive the struggling carrier. The new boss, Samer Majali, is credited with turning around and privatizing Royal Jordanian.

He immediately set out to re-evaluate Gulf Air's entire operations, and is looking at culling unprofitable routes and potentially renegotiating billions of dollars worth of aircraft orders.

Mumtalakat did not provide specific financial details about Gulf Air or Alba. While the smelter lost money, mostly because of financial bets and a one-time restructuring charge, it managed to generate "positive cash flows" despite lower aluminium prices, the company said.

Gulf companies, both state-owned and private, have struggled to attract cash in the wake of the debt crisis in the nearby financial hub of Dubai.

Mumtalakat has not spoken publicly about the bond sale. But al-Zain said the company's financial future generally looks brighter going forward.

"In 2010 I see a great opportunity to really enhance the value in our portfolio companies and potentially start the process of rebalancing our portfolio through measured steps," he said.