WBY talks to Andreas Schweitzer , Senior Managing Partner of Arjan Capital , on the significance of the Iranian market, investment challenges , the regulatory environment, and expectations for the future in foreign Investors .
Mr. Schweitzer is a CEO with expertise in start ups, SME’s and frontier markets business development and also serves as an advisor to the trade and commodity division of Metallco International Ltd, a 40-year-old industrial merchant company specializing in automotive/rail, power generation, offset- and counter trade.
Since 2009, Mr. Schweitzer has had an active presence in Iran, advising international industrial and investment companies targeting the Iranian market, as well as facilitating sanctions-compliant industrial and commercial activity. Mr. Schweitzer is a member of a Swiss-Iranian investor group that procured licenses for wind farms in Iran.
In 2004, Mr. Schweitzer co-founded a company that developed a hydro-electronic power drive systems for mid-sized, on- and off-grid wind turbines. Previously, Mr. Schweitzer created and managed a US$ 200 million market-timing fund; and has held management positions at Jacobs Suchard (now Kraft Foods Schweiz AG), in France, Panama, Switzerland, India and the UK.
Mr. Schweitzer has been a founding partner of startups and served in executive roles in international banks European asset management firms including A. Sarasin & Cie (1980-1983) Jacobs Suchard AG(1984-90) and Kenk & Schweitzer Associés (1990-1994). Mr. Schweitzer serves on a number of SME boards of directors and is actively involved in the Young Presidents’ Organization (YPO).
When did Arjan Capital establish its operations in Iran?
I started as an investor in Iran in 2009. In 2014 I have been invited to speak at one of the early Iran conferences in London. As a result, three EU Multinationals approached me to assist them in the execution of their Iran strategy. This was the birth of Arjan Capital Ltd., a sanction compliant company, assisting these international companies. Arjan was created by its partner that come from investment banking, law and industry. We established an EU regulated company in Malta and an own law practice in Tehran. Iranian project owners has high expectation. There are many opportunities in Iran for investment but less feasibility studies has been done for projects. I think Iran has more opportunities for investment more than fiance or loan, because investor will have projects at the end.
How would you characterize the regional market and your company role as project financier?
We focus on Iran where we consider the need and the opportunity lies. However, we believe that truly well managed Iranian companies could benefit from a significant advantage as a high class regional exporter. Iran could also become an interesting base for international companies as a manufacturing and know how hub.
What services are you promoting in order to attract a larger customer base and expand your market share?
We support companies to get financing, finding partners, and or investors. We are currently supporting a Swiss company launching a receivable financing fund, assisting EU and Swiss exporters to safely export to Central Asia and in particular to Iran.
We advise on company creation, setup, staffing and management. In summary Arjan Capital is the initial CEO office for international companies coming to Iran.
What challenges do you face for doing your business in Iran compared to other countries?
Due to 30 years of isolation there is still a gap of understanding between Iran and the international markets. This situation is similar to the GDR, former East-Germany. Iranian companies are well advised to go abroad to present themselves to the international financial sector. This requires preparation and a budget and in our experience unfortunately not many Iranian companies are willing to undertake either and believe that investors will accept local rules established over 30 years.
What are the strengths and weaknesses of Iranian projects for investment or financing?
I consider Iran fertile ground for international industrial investors and companies interested to sell or manufacture locally. Here are great JV opportunities. I further believe that financial investors will remain cautious due to the not yet lifted secondary US sanctions and the lack of business transparency.
Mid size projects in the sectors of agriculture, mining and mining services petrochemical, hospitality (hotels and hospitals) has high change for attracting foreign investors.
What criteria are you looking for in these projects?
Clear business proposition and a willingness from the Iranian project owner to provide transparenet expected by international investors
How would you evaluate your position in the market?
This is for the competition to judge, Due to the fact that I am an investor in Iran since 2009 and we are present on the ground we can provide added value to international companies coming to Iran and Iranian companies looking for international partnership and financing.
What are your expectations for 2017?
The market will slowly improve and open. The key factors to growth in Iran are funding, hence a financial system related to international markets and the build up of infrastructure (ports, storage) as well as custom services.
What is your message for international business and investment community?
To do business in Iran you need 3 things: time, money and good nerves. International companies with a long term strategy will succeed.
