Posts Tagged AMISOM

Industry Talk: Bancroft Global’s Bet On Peace In War-Torn Somalia

This was a story that came up on my radar back in April that needed to be put out there. It helps to fill in some of the blanks about this company and what they have been up to in Somalia. I had no idea that they were involved in the construction of a resort in Somalia and here are the details.

International Campus, which he says cost more than $6 million, is now open for business and mostly booked. Beyond the pool and the ocean views, there is a bunker, a trauma hospital and something akin to Mad Max’s version of an auto body shop, where specialized gear heads will fix “the ballistic glass on your armored vehicle,” as Mr. Stock puts it.
He expects the new place to break even next year. The trailer park, he says, is grossing about $2 million a year. When his cement-making business opens up, there is an entire city to patch and restore.

His strategy is pretty simple, and summed up in this statement.

Mr. Stock’s gamble: The security outfit will help guide the country toward peace, turning his investments into big money. “It’s like getting in at the bottom of the stock market,” says Mr. Stock. His unusual war operation is making him into a kind of ultimate gentrifier, a mini mogul of Mogadishu, perhaps.

In the article below, it mentioned that the security component was actually losing money. But because that operation is helping to push the country along towards peace and stability, that it will support the company’s main goal of being situated to make money off of it’s real estate/reconstruction investments there. Everything needed to stand up a country during the reconstruction phase will be a market that BG is positioned for. Very smart, but risky and I hope it pays off for them.

And Bancroft isn’t the only group trying to set up shop in Somalia to support the future reconstruction efforts. Check this one out.

With dwindling war efforts in Iraq and Afghanistan, other American contractors are moving in, too. A Virginia company, Atlantean, is setting up an airport hotel in the south. Among its board members, according to its website, is former Maj. Gen. William Garrison, who led the mission associated with Black Hawk Down. In the movie version, he was played by Sam Shepard. Maj. Gen. Garrison couldn’t be reached for comment.

My other thought about this deal is that Somalia will be the model for what is going on in Mali. That mission will require logistics and support for the post-conflict reconstruction effort. These folks will need hotels/living areas to support the various missions, and companies like BG will step in to make it happen.  As the wars in Iraq and Afghanistan wind down, numerous companies will be looking at places like Somalia to fill a need. They will also be watching how this business model works out and take notes.

There will also be plenty of capable folks willing to do this work, and men like Michael Stock will be leading the charge. Pretty cool and we will see how it goes. –Matt


Michael Stock is pursuing an extreme version of that basic investor’s principle: Get in early. He’s just finished building a resort on the coast of war-torn Mogadishu, Somalia. WSJ’s Christopher S. Stewart reports. (Photo: Dominic Nahr/WSJ)

A Bet on Peace for War-Torn Somalia
April 26, 2013
Michael Stock sees things that others don’t. “Imagine this,” he says one recent afternoon, standing on the sunny second-floor deck of his new oceanside hotel in Somalia’s war-battered capital. “There are banana trees where there’s desert now, and there’s this view.”
The banana trees haven’t grown in yet, but International Campus, as he calls the complex, is the closest thing to a Ritz for many miles. A fortified compound sprawled across 11 acres of rocky white beach, it offers 212 rooms including $500-a-night villas, several dining rooms, coffee and snack shops, and a curving slate-colored pool where sun-seekers can loll away Somali afternoons.
“It’s going to be ridiculous!” Mr. Stock said, just weeks before residents began arriving for April’s opening.
A few hours later, the jittery sound of gunfire split the warm February air not far from his new hotel—a reminder that the country is still muddling through a decades-old conflict and that there are still bullets flying, bombs detonating.
Bananas in the Desert
Most Western countries have avoided Somalia, leaving a void to be filled by contractors like Michael Stock’s Bancroft Global Development. He envisions ‘banana trees where there is desert.’
Mr. Stock isn’t just anyone gambling on a far-fetched idea in a conflict zone. In an unusual twist of the war business, the 36-year-old American is deeply involved in the conflict itself. In addition to being a real estate developer, his company also helps train Somalis in modern military techniques.

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Mali: As France Goes To War Against The Islamists, What Will Be The PMSC Contribution?

I see three areas of focus coming out of this new conflict, that PMSC’s will be crucial for. The first is security services for private interest throughout the Sahel. In the articles below, I have listed all the actions of companies in Libya, Egypt, Nigeria, and Mali, and it is one of reaction to the events in Mali. The Islamists are targeting western interest as a way of hitting back at France and the west, and the hostage crisis in Algeria is a prime example.

The services I see as crucial would be an increase in PSD services, kidnap and ransom services, static security reviews and manpower increases at facilities, and evacuation services.

The second area of focus for PMSC’s would be logistics, and especially as the conflict drags on and the ECOWAS force comes into play. Whatever force they come up with, it is being drawn from the poorest nations in the area, and this army will have nothing in the way of equipment or support. So I could see the typical players for logistics stepping up for this conflict. The AMISOM mission is a good example of what I am talking about and I believe the main players there are Dyncorp, PAE, and Bancroft Global Development.

Perhaps because this is France’s deal, there might be more emphasis on using French PMSC’s? On the other hand, if the US is footing the bill for training up this ECOWAS force, then it will be their choice for who will support the mission. There will be plenty to choose from and we will see how this pans out?

The final area of focus will be training. I really think the model here will be something like what is going on with AMISOM for Somalia. The forces of ECOWAS will have very little to no experience fighting in deserts or fighting an insurgency. You need a robust training program that will meet then needs of such a mission. Not only that, but you must also account for the education levels of those forces being sent in the first place. So training will be vital to the success of France and the west in Mali, and this will be a long term effort much like how AMISOM has turned out.

I could even see some contracts coming up that are focused on training the new government of Mali. Training, mentoring, and support for both the government and the military, will all be possible contracts in the future for companies.

Overall though, I don’t give Mali much hope unless it figures out it leadership and government. Hopefully the new government will come together and stay focused, but these things tend to be really messy if we look at past experiences. Yet again, I point to Somalia as the model of how messy this could be. Mali must have a leader or leaders that the people (and soldiers) can support and even fight for. The west can expend millions of dollars on training this military to expel the jihadists from the north, but Mali must have a solid government or ‘foundation’ to build from in order to keep the jihadists and military in check, now and well into the future. –Matt


Edit: 01/20/2013- I wanted to add two more articles that detailed the efforts of energy firms throughout the region. Either companies are boosting security, or they are evacuating folks just to be safe.
The Energy Giants at Most Risk in Northern Africa

Foreign Firms in Algeria Boost Security

Security experts said Algerian authorities may now need to rethink the way security is handled, allowing more foreign involvement in the process.In other high-risk resource-rich countries, such as Iraq, foreign companies commonly employ private Western security companies that are staffed by armed expatriates. Algeria, in contrast, keeps the majority of armed security personnel local, said one security consultant.Typically in Algeria, an oil company hires a foreign contractor to advise on security or to head a team, but the majority of the personnel carrying arms are limited to Algerians, the person said. Some of that security is provided by companies set up by retired Algerian generals, the person said.The system could result in lower-quality security, he said. “Even before the French were in Mali, Algeria hasn’t been the safest place to operate in for a long time,” the security consultant said.

Algeria crisis triggers Libya, Egypt oil security review
Jan 18 2013
* Libya says boost oilfield protection in south
* Italy’s ENI biggest operator across the border
* Some firms in Egypt say reviewing security
* Staff evacuation, tighter security to raise costs,
By Marie-Louise Gumuchian and Ron Bousso
Libya rushed to beef up security at its oil fields and energy firms were considering similar measures in Egypt as Islamist militants threatened to attack new installations in north Africa.
More than 20 foreigners were still being held hostage or missing inside Algeria’s In Amenas gas plant on Friday after Algerian forces stormed the desert complex near the Libyan border to free hundreds of captives taken by Islamist militants.
Hundreds of workers were evacuated from a number of Algerian production sites on the border with Libya to safer places in the country’s centre and industry experts said that could ultimately lead to lower oil and gas production from the OPEC member state.

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Publications: Stability Operations Magazine, September-October 2012

Another great issue of SO. I liked the discussion about AMISOM and their mission in Somalia. There was even a mention of Bancroft Global Development (BGD).

Although what was missing was how instrumental contractors have been to the AMISOM mission. Meaning, contractors are there training and providing logistics to these guys for the fight against Al Shabbab, and you don’t hear much about that contribution.

The other part of the story is that the UN gets very questionable troops from their member nations. Often times, these troops are poorly funded, trained and equipped, and yet they are tasked with conducting very complex operations. The mission in Somalia is not peace keeping either–it is war fighting. So the skills that AMISOM is gaining by working with companies like BGD, are essential to survival and winning on the battlefield. That is what is interesting to me about AMISOM and the recent gains in Somalia. –Matt


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Industry Talk: Ugandan PSC’s Eye Business In Somalia After AMISOM Victories

Now this is a very interesting development. All of these security contractors from Uganda that have participated in such programs like TWISS in Iraq, are now looking at Somalia as the next market for security contracts. Which makes total sense, and especially since there is a massive pool of Ugandan security contractors created by their efforts in Iraq.

Uganda is also a huge contributor of forces for AMISOM, so it would only be fair that their country’s PSC’s would have a crack at any contracts in Somalia. I would imagine Burundi would also be interested in entering the reconstruction market in Somalia as well. Uganda has also lost 57 plus troops in the war, and Burundi has lost 78. But the real market of force would come out of Uganda.

This pool of security contractors are also trained to western standards, with experience in Iraq and Afghanistan, and they could be an excellent tool to use for Somalia’s reconstruction plans. But like the article mentioned below, if the gains made by AMISOM are lost, then there really is no chance of PSC’s coming in. We will see how it goes? –Matt


Ugandans eye businesses in Somalia
By John Semakula
12th September, 2011
THE business community in Uganda received the news of AMISOM’s recent victory against the al-Shabaab militants in Mogadishu with a smile of hope. ?The community had long wanted to venture into Somalia but the insecurity in the country had hindered it. ?When news emerged that the AU peacekeepers had secured 90% of Mogadishu from the militants, managers of various companies in Uganda started drawing business plans for Somalia.

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Company Spotlight: Bancroft Global Development, the 501(c)3 Non-profit PMC

    That’s right, I am not making this up.  Bancroft Global Development is a no-kidding non-profit PMC. lol.  Anyway, this is all I could scrape up about BGD, and I thought it was a pretty cool concept.  I don’t know of any other non-profit PMC’s out there, and this company totally presents a different view on how we look at the PMC.  I also posted their earnings from 2007, and it looks like they are doing pretty well.

     What I really like about this is that is takes the whole ‘evil profiteering PMC’ element out of the conversation.  Although I would like to hear about any downsides with something like this, and I am all ears with the readership.

     So how about a non-profit Co-op PMC as an idea for a company? Just thinking out loud, and there are all sorts of interesting paths you could take with this stuff.  By the way, if any BGD guys would like to comment, or post any PR stuff, feel free to do so in the comments or send it to me and I will edit this thing.  I also look forward to when the website becomes fully operational and if they start looking for guys for their operation in Somalia and elsewhere. –Matt


From their website.

Bancroft Global Development is a non-governmental organization dedicated to removing violence from public discourse, by promoting permanent solutions to the economic, environmental and societal harm caused by armed conflict.

Bancroft Global Development was duly organized in 1999 under the laws of the United States as a 501(c)3 not-for-profit charitable organization.

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