New Lease of Life for Omani State-Owned Glass Maker: What It Means for Investors and Business Growth in Oman
MUSCAT, JAN 10 – The Board of Directors of Majan Glass SAOG, a majority state-owned company, has approved an acquisition offer from an Omani investor, potentially revitalizing the struggling publicly traded glass manufacturer.
Founded in 1997, Majan Glass operates Oman’s first major glass container manufacturing facility in the Sohar Industrial Estate. The company produces glass bottles and jars for the soft drinks and food and beverage sectors, serving both local and export markets. As of the end of 2024, the Oman Investment Authority (OIA), the Sultanate’s sovereign wealth fund, owned 88.21% of the company’s shares.
Despite its pioneering role, Majan Glass has faced years of operational losses, ongoing cash shortages, a negative adjusted net asset value, and significant doubts about its viability as a going concern. By December 31, 2024, the company’s accumulated losses totaled RO 6.373 million, completely eroding its share capital.
In response to these challenges, Emerald National Investment SPC (ENI), affiliated with Makaseb Investment LLC, submitted an offer last month to acquire all 42.03 million fully paid-up shares of Majan Glass at RO 0.004 per share.
At a recent meeting, the Majan Glass Board approved the offer, emphasizing the acquirer’s commitment to maintain the company’s core operations, improve performance and efficiency, and uphold employee and contractual obligations.
The Board’s decision was supported by an independent assessment from Vision Capital, which confirmed Majan Glass’s recurring losses, high debt levels, limited liquidity, and negative net worth due to accumulated losses. Vision Capital’s valuation underscored significant uncertainty about the company’s future viability, with adjusted valuations indicating negative equity. Despite efforts to attract other investors, no competing bids surpassed ENI’s proposal.
Majan Glass’s latest annual report cited several factors behind its financial struggles, including geopolitical tensions disrupting the Levant market, inflation reducing demand in Europe, rising interest rates, elevated raw material costs, boycotts of some international carbonated beverage brands, and increased shipping expenses caused by Red Sea disruptions.
Looking forward, the company may benefit from the potential to use locally sourced, cost-effective raw materials following an agreement by Minerals Development Oman (MDO), an OIA subsidiary, to develop glass-grade silica sand deposits in Block F 51, Al Wusta Governorate.
This acquisition marks a critical step toward stabilizing and potentially revitalizing Majan Glass, ensuring its continued contribution to Oman’s industrial landscape.
Special Analysis by Omanet | Navigate Oman’s Market
The acquisition of loss-making Majan Glass by Emerald National Investment signals an opportunity for operational turnaround in a strategic manufacturing sector critical to Oman’s industrial diversification goals. While persistent financial challenges and external market pressures pose risks, the shift towards locally sourced raw materials like silica sand offers a promising avenue to enhance cost competitiveness. Smart investors should watch for strategic restructuring and supply chain localization as key drivers for future value creation in this sector.
