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Lebanon 2014 | ECONOMY | B2B: HOLDING & DIVERSITY

Many old family companies in Lebanon have branched out from their original plans to incorporate many aspects of business, products, and services.

Nadim B. Saikali
NADIM B. SAIKALI
Founding Board Member
Debbane Saikali Group
Elias Ph. Assouad
ELIAS PH. ASSOUAD
Chairman
Assouad Group

What were the main stages of diversification in the company?

NADIM B. SAIKALI There are many companies that are part of the foundation. Pesco International is the international arm of Debbane Saikali, which handles relations and contracts with foreign companies. After that, we specialize in niche markets like energy, energy control and saving, as well as construction materials. Exotica is our horticultural landscaping company, while Enoteca and Wines of Lebanon are for wine distribution, production, and marketing. We also have non-agricultural groups such as Pesco Telecommunications and Pesco Energy, the latter of which was just started a few months ago to handle renewable energy and its control and development. This company aims to optimize the use of energy in commercial and industrial installations. One of the most important companies we have in the energy sector is the Insulco Group. The company is about 40 years old, and mostly deals with hot and cold insulation in the Gulf, as well as fire protection for industrial buildings, which is a niche market. We are one of only three or four companies in the Middle East that do this, and we are active in the region.

ELIAS PH. ASSOUAD From 1973, we started manufacturing machines for different industries, but we were always thinking about renewable energy. We started in 1976 with solar heating, but it was not feasible at that time because oil was so cheap that to amortize such an installation would require at least 25 years. Energy recovery, which is the process of recovering heat from the burning of fuels, was something we started at the end of the 1990s. We are the only company manufacturing and installing energy recovery systems, at least in Lebanon, because it requires a lot of engineering, know-how, and expertise. We are installing a system at the Grand Hills Hotel that will recover heat from its generators to heat the swimming pool and other areas. We are also carrying out a recovery project for Sidem, an aluminum factory. We are going to provide it with 4.2 tons of steam that we get from the exhausts of its generators, which will equate to a reduction of around $250 an hour in costs. We are also carrying out a recovery process for Pepsi Cola, the second stage of which is already complete. We are also finalizing a water chiller system with City Mall. This will chill water with an absorption system from its generator, which is equivalent to 1,000 tons of refrigeration. Besides this, we are the first people to work on virtual power plants. In 2015, we will have four virtual power plants, and we are in the process of assembling those now. In Lebanon, we will also boast the first series of solid oxide fuel cells, which have almost zero CO2 waste.

What were the incentives for Debbane Saikali to form a separate corporate organization from the Debbane Group?

NBS When I joined the Debbane Group in 1980 as a Managing Partner, the intention was to bring two vectors of strategic growth to the group. One was regional, whereby I would take the know-how and competence of the group outside of Lebanon and try to utilize that competence, for example agriculture in Saudi Arabia, Kuwait, or other countries. After this, our aim was to develop the group's potential, importance, and good reputation to do other activities, mainly in the fields of building materials, construction chemicals, insulation energy and gas projects, and telecommunications both in and outside of Lebanon.

How has the Assouad Group developed since it was founded in 1865?

EPA We are an innovative company. Our family started in business in 1865 in Egypt making cigarettes at a tobacco factory. In 1890, Egypt decided to nationalize the tobacco industry and took over the manufacturing of cigarettes. The only business left in the family was civil contracting run by my grandfather. He was a skilled contractor and became with years one of the greatest contractors in Egypt. Philippe, my father, graduated as a civil engineer from ETP Paris in 1923 and was convinced by the French mandatory government of Lebanon and Syria to work for the Syrian government. He was in charge of the development of the urbanism of the city of Damascus. In 1961, he left Damascus and came back here and created Tecmo. When I graduated, in 1971, I was ready to take over, and did so in 1973.