Saudi Alessa Group in $200m deal with US firm 

(MENAFN - Khaleej Times) A US maker of industrial air conditioners has formed a $200 million joint-venture with Saudi Arabia's Alessa group, in the first major deal to emerge so far from the Big 5 construction show in Dubai.

Huntair, Inc., has teamed up with Alessa Advanced Projects Company to build the American brand's air-conditioning units in Saudi Arabia, executives from the two companies announced on Tuesday.

Under the agreement, Alessa will start manufacturing Huntair units under license in the first quarter of 2011. Alessa will have exclusive distribution rights for Huntair products in Saudi Arabia and shared distribution rights elsewhere in the region and in North Africa.

Huntair, a subsidiary of the CES Group, is a relative newcomer to the Middle East. Its only business in Saudi Arabia so far has been an $85 million sale of equipment to the new King Abdullah University north of Jeddah, and it sees great promise in the GCC's biggest member country.

"We believe that in the next four to five years, there's in excess of $1 billion in business" to be won in Saudi Arabia, Huntair Vice-President and Chief Operating Officer John Albert told Khaleej Times.

Huntair opened a sales office this week in Abu Dhabi's Masdar City. Its products are already available in the UAE. Other markets on its radar include Syria, Iraq and Qatar, Albert said.

Oregon-based Huntair generated $150 million in annual sales last year, with the sale to King Abdullah University contributing more than half of that amount.

Huntair's technology relies on a modular design of several smaller fans instead of a single large one. This makes its air conditioners more energy-efficient and quieter than most of the competition, said Eng. Nawaf Abdullah Almasoud, President of Alessa Advanced Projects.

The Big 5 is a barometer of the regional construction market. In spite of the lack of any other big business announcements, the show was crowded with visitors on its second day.

Italy's Minister of Economic Development Claudio Scajola toured the show and made a speech in support of Italian companies, which comprise one of the biggest national groups at the four-day event.

By Bruce Stanley