Introduction

ABM Technologies, in pursuit of its mission and vision in bringing world class contribution to the increasing demands in various sectors in Saudi Arabia has proposed to team up with JellaJella, a Dutch registered company, who provides business consultancy services and business representation to its portfolio companies. JellaJella’s mainly, but not exclusive, focus are companies related infrastructure supply. This includes as well as equipment as engineering services.

Mainly Dutch companies who want to expand their business in Middle East market JellaJella provides them the necessary input and matchmaking facility to connect with people and companies whom they can work together with in the region.

Both companies feel that a partnership could be beneficial to all the parties involved and they have therefore stated the intent to proceed with the establishment of a Joint Venture agreement. In order to stress out the equal share of work involved, both parties’ intent is to have an equal share in the new company.

This document will form the start of the further detailing and finalizing of the mutual agreement.

Strategy

ABM Technologies and JellaJella propose to form a Joint Venture in Saudi Arabia by the name of JellaJella Arabia. It is the aim is to become the strategic partner in Saudi Arabia for all the companies under JellaJella’s portfolio. In order to realize this, various strategies or business proposals can be presented, like the following (not excluded to and might vary on a case to case basis);
 

Strategy # 1

JellaJella Arabia will act as the (exclusive) distributor/agent to manufacturing companies whose products have demands in Saudi Arabia
 

Strategy # 2

JellaJella Arabia will act as the marketing liaison for any match-making event, conference and exhibition that JellaJella will hold in Saudi Arabia. These events provides JellaJella Arabia with great marketing exposure to the target customers, and provides the opportunity to stress out its Government relations since most of these events will be organized in close cooperation with the Dutch Embassy in Riyadh.

Strategy # 3

JellaJella Arabia has the objective to provide its customers with the best possible assistance to capitalize the market potential. In case of engineering services and/or products that can not be handled on a “buy to sell” basis (e.g. large power transformers that need pre engineering, commissioning and after sales support), this objective has to coincide with a profitable return on investment for the own JV company. JellaJella Arabia should therefore be flexible in the way to strategically team up with different potential local parties in order to suit both objectives. In all cases the company falls under the agreement with JellaJella Arabia as their local partner. This would mean the most likely way to conduct business on a mutual beneficial way would be:
1. Strategically team up the related company with a local party (e.g. contractor) for the project at hand and gain a success retainer from the Dutch company according to the agency agreement in place. This is most likely to be the case related to engineering services,
2. Act as the supplier of products and/or services in case there is a strong believe that the services can be provided at a higher margin than offered by the original supplier. Special arrangements need to be taken into account regarding liability as acting as a supplier on behalf of the OEM.

Activities concerned

The success of the JJ Arabia depends solely on the strong will of the two individual companies to invest primarily in terms of human capital. The skills of the people involved determine the success of the new venture.
The strategic advantage of the new venture is the representation in both countries involved; Saudi Arabia and the Netherlands. This would mean that in close cooperation, on two sides of the bridge work can be executed, both conditional for the success.

Activities at hand relate to pre qualification, assessment of suited companies, determining promising projects, expanding the current company portfolio, negotiating the various agreements, etc..

The most important objective for the short term should be to get a foot on the ground and to build up a track record in order to prove our success to potential newcomers.

Market Segments

JellaJella has gained access to Dutch finest industries through the accessibility to the various representative offices. As such JellaJella has access to more than 2600 companies all in the relevant field of industries. Generally speaking infrastructure supply, energy/petrochemicals and medical and healthcare are of primary focus. This therefore also embodies industries like wastewater treatment engineering, etcetera.
Activities on the short term

This white paper is an outline of the new venture JellaJella Arabia. In order to make the venture to a success various activities need to started, starting from now.

The activities on the short term are (not excluded by);

	Starting the JV forming procedure by accepting this outline of the new venture,
	Starting pre qualification for the most determining companies under JJ portfolio beginning with Wolter & Dros (electrical and mechanical engineering company),
	Determining the most promising projects at hand with good chances of success for the current portfolio,
	Expanding the portfolio in the most promising market segments and arrange contractual arrangements with each individual company,