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Thursday, 16 December 2010

The promise of Egypt’s bourse | beyondbrics: News and views on emerging markets |

Egypt’s stock market has outperformed wider Middle East stock indices over the past two years, but more recently nervousness over next year’s presidential election has deterred some foreign investors from moving money into the country.
Still, asset managers say it has long-term promise underpinned by Egypt’s 80m consumers, many of whom are becoming rapidly wealthier. That differentiates the country from its oil-dependent neighbours, as does the praise accorded to its regulatory infrastructure. The FT has more on the market here, part of a special report on Egypt published on Thursday here.

Interview with Hochtief CEO Lütkestratkötter: Qatar Investment 'Not an Act of Desperation' - SPIEGEL ONLINE - News - International

Graphic: Hochtief ownership structure

Since September, the German construction giant Hochtief has been fighting off a takeover bid by the Spanish company ACS. SPIEGEL spoke to Hochtief CEO Herbert Lütkestratkötter about the recent investment from Qatar, his wariness of the Spaniards and why he is uninterested in a high severance payment.
SPIEGEL: Mr. Lütkestratkötter, for months you have campaigned energetically against the takeover of Hochtief by major Spanish shareholder ACS. Now you have announced that the Emirate of Qatar will be a new major shareholder. Isn't this an act of desperation?
Lütkestratkötter: It's strategy, not an act of desperation. The talks with Qatar haven't exactly been going on since yesterday. We have been active there for a long time. We are quite clearly an attractive partner for Qatar, and the reverse is also the case. They aren't investing in our company out of desperation.

Qatar Shares Retreat on Concern World Cup Gains Are Overdone - Bloomberg

Qatar’s shares fell to the lowest level in more than a week on speculation optimism over economic and earnings growth related to the Persian Gulf country’s win to host the soccer World Cup in 2022 may have been overdone.

Barwa Real Estate Co., Qatar’s biggest publicly traded property developer by assets, declined to the lowest level since Dec. 6. Commercial Bank of Qatar, the country’s second-biggest lender, lost the most this month. The QE Index slid 0.5 percent to 8,733.16, the lowest since Dec. 7, at the 12:30 p.m close in Doha. The measure has lost 0.2 percent this week, trimming the gain since winning the rights on Dec. 2 to host the tournament to 6.7 percent. The Bloomberg GCC 200 Index of 200 companies in the Persian Gulf gained less than 0.1 percent.

“Following the euphoria of the World Cup, the market did well,” said Ahmed Talhaoui, Abu Dhabi-based head of investment at Royal Capital. “Now we see some profit-taking. The rally is overdone.”

Carlyle Gets $500 Million Investment From Abu Dhabi - Bloomberg

Carlyle Group received a $500 million investment from Mubadala Development Co., part of the Abu Dhabi government, as the world’s second-biggest private equity firm prepares for an initial public offering.

Mubadala will receive convertible subordinated notes and additional equity in the firm, Carlyle said in an e-mailed statement today. The private-equity firm sold a 7.5 percent stake to Mubadala in 2007 after shelving plans for an IPO amid the credit crisis.

Leveraged buyout firms are struggling to raise money for acquisitions even as the pace of their acquisitions more than doubled to $238 billion this year, according to data compiled by Bloomberg. The Washington-based firm, founded in 1987 by William Conway, David Rubenstein and Daniel D’Aniello, plans to file papers for an IPO late next year, according to people with knowledge of the matter.

Etisalat Said to Cut Stake Purchase in Kuwait's Zain to About 40% From 46% - Bloomberg

Emirates Telecommunications Corp. may buy about 40 percent of Kuwait’s Zain, less than earlier planned, according to two people with knowledge of the talks.

The size of the purchase was reduced after a Zain shareholder decided not to sell shares, one of the people said, declining to be identified because the discussions are private. Etisalat, as Emirates Telecommunications is known, had initially planned to buy 46 percent of Zain.

For Etisalat, the United Arab Emirates’s biggest phone carrier, the purchase would extend its reach in the Middle East, where Zain operates in countries from Kuwait and Iraq to Bahrain. Etisalat offers phone services in 18 countries in the Middle East, Africa and Asia, counting more than 100 million customers, according to its website. The seven emirates comprising the UAE make up about 86 percent of Etisalat’s sales.

Investment firm scraps Egypt retail chain takeover | Reuters

Egyptian investment firm Arabiyya Lel Estithmaraat said on Thursday it had scrapped a plan to take over the historic Omar Effendi department store chain after unsatisfactory results from a due diligence process.

In October, Arabiyya had agreed in principle to buy an 85 percent stake in the chain for 320 million Egyptian pounds.

'The results that the special report reached in the due diligence process were not satisfactory,' a statement from the company said. 'The previously signed contract was contingent on due diligence and therefore it is no longer valid.'

Foreigners now able to own real estate in Syria « ArabianMoney

The quiet economic revolution taking place in the formerly communist bloc style Syrian economy has continued with news that foreigners are now able to own property. A stock market opened in March last year.

The Syria Arab News Agency reported: ‘During a weekly meeting chaired by Prime Minister Mohammad Naji Otri, the Cabinet passed on Tuesday a bill allowing non-Syrians to own real estate in the Syrian Arab Republic according to regulations and basis, terminating the execution of Law no. 11 for 2008.’

Kuwait to Fully Run New Trading Index in November, Al-Qabas Says - Bloomberg

The Kuwait Stock Exchange will put its new trading index on test during the first quarter of 2011, aiming to operate it fully by November, Al-Qabas reported, citing KSE Director Hamed al-Saif.

The new index, which is supplied by Nasdaq OMX Group Inc., will consist of 15 “carefully selected” companies that will be subjected to change based on bi-annual evaluations and conditions, al-Saif said, according to the newspaper.

“The new index will be more useful for investment managers, technicians and foreign investors,” Al-Qabas cited al-Saif as saying.

Dubai's Nakheel to issue $1.6 bln bond end Jan -report, UAE Industries - Maktoob News

Troubled Dubai developer Nakheel plans to issue a 6 billion dirham ($1.63 billion) Islamic bond, part of its restructuring plan, to trade creditors at the end of January, its chairman was reported as saying.

"We are confident that we can close the file during the coming 45 days," Arabic daily al Bayan quoted Ali Rashid Lootah as saying on Thursday.

Nakheel has 85 percent of acceptances by value for its debt restructuring.

gulfnews : Rakia plans to focus on domestic projects

Ras Al Khaimah Investment Authority (Rakia), the government's investment arm, is planning to either reduce or exit from its international projects to be able to focus on domestic ventures, a top official said.

"His Highness Shaikh Saud Bin Saqr Al Qasimi, Supreme Council Member and Ruler of Ras Al Khaimah, has instructed us to focus on Ras Al Khaimah and reduce our investment outside," Dr Khater Masaad, Chief Executive Officer, told Gulf News on Tuesday evening on the sidelines of a briefing organised by the CEO Club — a network of 11,000 members worldwide — in Dubai.

Rakia has investment projects in Georgia where it runs the Black Sea port of Poti. Rakia had a plan to develop a free zone, and it also has been given land to develop properties near the capital Tiblisi.

Gulf Carriers Use Youth, Cash to Squeeze Western Rivals With 300 Planes - Bloomberg

Emirates, Etihad Airways and Qatar Airways Ltd. say it’s their youth, not state aid, that has allowed them to put the squeeze on western rivals with almost 300 plane purchases worth $70 billion in three years.

The expansion of the Gulf carriers has drawn the ire of Air France-KLM Group Chief Executive Officer Pierre-Henri Gourgeon, who says Dubai-based Emirates has 3.5 billion euros ($4.7 billion) less in annual costs because it is state-owned. Tilting the playing field further, he says, is a treaty barring airlines in Britain, France, Germany, Spain and the U.S. from receiving credit guarantees for purchases from Airbus SAS and Boeing Co.

“I’ve got one secret weapon and it’s that I’m not a legacy carrier,” Etihad CEO James Hogan said in an interview in London. “If these chaps had been setting up an airline in the last seven years they’d be doing exactly what I am.”

Qatar Makes $65 Billion Bet It Can Remake Economy in World Cup Preparation - Bloomberg

The stadium where Qatar will host the 2022 World Cup final isn’t built yet. Neither is the city.

Getting the Persian Gulf sheikdom ready for the world’s most-watched sporting event will cost as much as $65 billion, Merrill Lynch estimates. That’s about $41,000 per person in Qatar, and only 20 percent of them are citizens.

Qatar, holder of the world’s third-largest natural-gas reserves, aims to transform itself into a global hub to compete with destinations like Dubai and Istanbul. While the preparation will keep growth above 10 percent in the next five to seven years, the country of 1.6 million still has to figure out how it can continue to benefit from the investment after the games are over, said Robin McCall, acting chief executive officer of Al Khalij Commercial Bank in the capital, Doha.

Investment Column: Hammerson offers value to build on - Sharewatch, Business - The Independent

Hammerson, in partnership with the Oman Investment Fund, has struck a deal to offload its Bishops Square office site in London's Square Mile. The buyer, JP Morgan Asset Management, has agreed to pay about £560m, netting Hammerson, which has a 25 per cent interest in its venture with the Oman fund, nearly £80m – a nice £34m surplus over the book value at the end of June.

The deal adds to growing evidence of a recovery in the capital's office market, which fell faster than other parts of the real estate market in the recession but is now recovering at a swifter pace. While the Bishops Square sale is positive, offices are only a minor part of the Hammerson portfolio. Just over half is prime shopping centres and a fifth is retail parks.

That seems worrying with the consumer outlook uncertain. The European operations are not particularly cheery either. However, Hammerson boasts one of the largest project pipelines in the business, and has never been shy about investing in development. So it could steal a march on competitors .

UAE wants to be numero uno in chip sector | TopNews Arab Emirates

One of the parts of Abu Dhabi Economic Vision 2030 is to become a market leader in the field of semi-conductor industry. And it plans to do so in the coming five years time.

At present, there are 27,000 engineers, technicians and Emirati graduates who are going to form the talent pool for the sector. There are many more in the making but it has been anticipated that the above mentioned people are going to be recruited in the field. The information was given by a senior official working with the Abu Dhabi Education Council (ADEC).

Till now, some 33 topics in as many as 8 working papers have already been kept before the government. These papers have been made by professors as well as students. These papers have talked in detail all the aspects that are covered in the semi-conductor industry. Chip industry is one of the most important vertical that Abu Dhabi has been targeting.

Dubai property valuation turns into guessing game

The economic downturn in Dubai has turned the science of property valuation into something of a guessing game, industry experts say.

Richard Paul, an associate director in Dubai for the consultancy Cluttons, said it was 'very, very difficult' to place an exact price on property, said

The old formulas simply do not work in the current market, analysts say. In many areas there are few or no recent transactions to use for comparisons. And prices paid a few months ago may not have any relevance today.

Dubai DIFC to Start Multi-Currency Clearing System - BusinessWeek

The Dubai International Financial Centre, a tax-free business park in the United Arab Emirates’ financial hub, plans to offer a “real time” multi-currency and multi-country clearing and settlement system next year.

“It will be used for banks’ operations and there is huge demand for it in the region,” chief economist Nasser Saidi said in an interview in Dubai today. The dollar and euro system “will be integrated with Hong Kong’s payment system and eventually a payment link” with China’s yuan, he said.

Dubai set up DIFC in 2004 to attract international banks, asset managers and insurers to help diversify its economy. International banks such as Goldman Sachs Group Inc. and Citigroup Inc. have their regional offices in the DIFC. Bahrain and Qatar have also set up financial districts to attract foreign banks. / Middle East - Bahraini business park lures investors

Brian Cogan, project director at Bahrain’s International Investment Park, points out of his window to highlight construction sites rising from the sand.

In one area there will be a $200m joint venture between China’s Chongqing Polycomp International Corporation and Saudi Arabia’s Abahsain. The groups hope that the finished plant will be exporting 140,000 tons of fibreglass a year. Nearby, German, Australian and Bahraini investors are due to build a 4,000 sq m detergent factory.

The investment park, developed by the kingdom’s ministry of industry and commerce on the edge of a new port, a short drive from the capital Manama’s airport and the causeway linking Bahrain to Saudi Arabia, is an integral part of the country’s efforts to attract foreign investors and create private sector jobs. / Capital Markets - Gulf gets taste for high-yield bonds

Gulf bond markets have flourished in recent years, but they remain dominated by sovereign or sovereign-linked debt. Lower-rated entities have proved either reluctant or unable to convince investors to buy their paper.

However, the hunt for higher yields by global investors, along with the ongoing dearth of regional bank lending and the funding needs of private companies, means that the local debt markets may start to broaden into the high-yield space next year.

High-yield bonds are tranches of debt issued by companies that are rated below investment grade – so-called “junk” – and typically carry a coupon, or interest rate, at least 350 basis points above comparable US Treasury bonds and bills.