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Tuesday, 6 December 2011

Bahrain's Investcorp sells U.S.-based Accuity Holding | Reuters

Alternative asset manager Investcorp completed the sale of its U.S. portfolio company Accuity Holdings for an aggregate enterprise value of $530 million, the Bahraini company said on Tuesday.

Investcorp said it has distributed $1.5 billion to clients from its four corporate investment portfolio exits over the last 18 months.

The company had assets under management of $11.8 billion as of June 30. Its net income for fiscal year 2011 rose 37 percent, helped by the profitable sale of some of its investment holdings, the company said in August.

In Abu Dhabi, Double-Dip Recession Fears Stalk Debate on the Global Economy - Arabic Knowledge@Wharton

The venue to discuss the declining economic health of Western economies could not have been located in a more ironic setting: The opulent Emirates Palace hotel in the capital of Abu Dhabi, one of the richest cities in the world. The panel was situated inside the hotel's expansive auditorium, featuring a stage framed by gilded reliefs of falcons, the symbol of the United Arab Emirates, amber lighting and surrounded with floral bouquets.

But attendees at the biannual Festival of Thinkers conference heard a prognosis for the global economy that was far from rosy. The session opening the gathering of internationally renowned scholars, business leaders and educators was largely downbeat, highlighting persistent concerns with the euro and sovereign debt.

"The problem is none of the institutions or countries have incentive to take into account the chain reactions their failures may make," said Eric Maskin, the 2007 Nobel Laureate in Economics. "Even when the world hasn't recovered, high leveraged ratios are a problem again."

Traders vexed by Libya's new oil chiefs | Reuters

The new leaders of Libya's top oil body have delayed official tender deadlines to negotiate better deals, traders say, frustrating some of their oil partners now in talks for lucrative 2012 oil contracts.

Freshly-appointed managers of Libya's powerful National Oil Corporation (NOC) are preparing to award sought-after crude oil and fuel import contracts worth billions for next year as the OPEC member's top industry resumes business after months of war.

The NOC is expecting to announce winners within the next few weeks in a process seen as an important test of the NOC leaders' ability to manage relations with international oil firms like majors Total as well as independent traders such as Vitol and Trafigura.

MENA stock markets close - December 6, 2011

ExchangeStatus IndexChange
TASI (Saudi Stock Market)
DFM (Dubai Financial Market)
ADX (Abudhabi Securities Exchange)
KSE (Kuwait Stock Exchange)
BSE (Bahrain Stock Exchange)
MSM (Muscat Securities Market)
QE (Qatar Exchange)
LSE (Beirut Stock Exchange)
EGX 30 (Egypt Exchange)
ASE (Amman Stock Exchange)
TUNINDEX (Tunisia Stock Exchange)
CB (Casablanca Stock Exchange)
PSE (Palestine Securities Exchange)

U.A.E. Banking System to ‘Face New Headwinds,’ Fitch Says - Bloomberg

The United Arab Emirates’ banking system will come under pressure as the global economic crisis and Abu Dhabi’s slowdown undermine asset quality and restrict liquidity, Fitch Ratings said.

Banks in the country will “face new headwinds” brought on by the “fragile” real-estate industry and problems at Dubai government-linked entities and U.A.E. companies, the ratings company said in a report today.

“The U.A.E. operating environment is not immune from global issues and this threatens the recovery in the banking system,” the report said, “Fitch is particularly expecting several key economic sectors such as trade, tourism and services to be negatively impacted.”

S&P Indices and Arab Federation of Exchanges create S&P AFE 40 Index -

S&P Indices has launched the S&P AFE 40, an index designed to measure the performance of 40 leading companies from the Pan-Arab region. S&P Indices partnered with the Arab Federation of Exchanges (AFE) to create the Index which includes companies from Bahrain, Egypt, Jordan, Kuwait, Lebanon, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Tunisia and the United Arab Emirates.

Robert Shakotko, Managing Director at S&P Indices said: "We are seeing a growing interest among investors in Arab equities as this market begins to mature. The Arab Spring and the liberalisation of Arab countries seem to signal a new era of investment opportunities in the Arab world. We are delighted to have worked with the AFE to create the AFE 40 Index, which is timely and fulfils the demand from investors seeking to measure this important, growing segment of the market."

Dr. Fadi Khalaf, Secretary General at the Arab Federation of Exchanges said: "The S&P AFE 40 is expected to be an important blue chip index in the Pan-Arab region, offering a true representation of the performance of leading, publicly traded companies trading on Arabian exchanges. We are excited to partner with one of the leading index providers in the world, S&P Indices, to offer this exciting,new benchmark to investors."

Saudi Arabia Pumping 10 Million Barrels a Day, Al-Naimi Says - Bloomberg

Saudi Arabia pumped about 10 million barrels of oil a day last month, and is prepared to supply a similar amount this month if needed, the country’s oil minister said.

“We produced 10 million and 40 barrels in November because that’s what the customers wanted,” Ali al-Naimi said in an interview in Durban, South Africa, where he is attending a climate conference. “If customers want the same thing in December we will provide that.”

Saudi Arabia is the biggest and most influential member of the Organization of Petroleum Exporting Countries, which meets on Dec. 14 in Vienna to set output targets for early 2012. Asked whether he thinks supply to the market needs to be altered, al- Naimi replied: “Wait until we meet.”

Dubai may use sovereign fund to repay debt | Reuters

Dubai, which narrowly averted a bond default in 2009, could use money raised by its sovereign wealth fund to help repay $3.8 billion in bonds owed by state-linked firms which mature next year, a source familiar with the matter said on Tuesday.

The Gulf Arab emirate has clawed its way back from the depths of its debt crisis, helped by an economic revival in trade and tourism and its safe-haven status amid the Arab Spring revolts, but still faces the challenge of big debt repayments.

The source said discussions in government circles focus on $3.8 billion in bonds due next year from a trio of state-linked firms which are seen as having the highest refinancing risk -- Dubai Holding Commercial Operations Group (DHCOG), part of the ruler's private holding company, DIFC Investments (DIFCI) and Jebel Ali Free Zone (Jafza).

Dubai’s debts: getting there? | beyondbrics –

In November 2009, Dubai was plunged into crisis when the Gulf city finally admitted that it wouldn’t be able to meet its debt obligations.

What a difference two years makes.

A $20bn bailout loan from the United Arab Emirates and Abu Dhabi prevented default. The government got its act together and earlier this year finalised a $25bn restructuring for Dubai World.

Dubai Shares Decline Most in a Month on Debt Restructuring Report, Europe - Bloomberg

Dubai’s shares fell the most in more than a month after a report that the emirate may restructure some bonds sold by state-owned companies next year and on concern Europe’s crisis may spread.

Emaar Properties PJSC (EMAAR), the developer of the world’s tallest skyscraper, slumped 3.6 percent. Dubai Islamic Bank PJSC (DIB) declined the most since Nov. 1. Dubai’s DFM General Index (DFMGI) dropped 1.2 percent, the most since Nov. 1, to 1,382.92 at the 2 p.m. close in the emirate. The Bloomberg GCC 200 Index (BGCC200) decreased 0.4 percent at 1:44 p.m. in Riyadh.

Dubai may issue the bonds to help meet $3.8 billion in payments, the Financial Times reported, citing a senior government official it didn’t identify. The official was confident a commercial deal could be reached with bondholders, it said. The Dubai government’s media office declined to comment when contacted by Bloomberg News. Shares also tumbled after Standard & Poor’s said it may strip France and Germany of their Aaa credit ratings.

Kuwait records large fiscal surplus in 6 months - Emirates 24/7

Strong oil prices pushed Kuwait’s actual revenue above their target for the entire fiscal year and allowed it to bask in a massive budget surplus of more than $32 billion, according to a key bank in the Gulf emirate.

Spending was up by around 12.1 per cent year-on-year to nearly KDfive billion ($18 billion) in the first six months of the 2011-2012 fiscal year, which began on April 1, National Bank of Kuwait said in a study.

Revenue, mostly from oil exports, totalled nearly KD13.9 billion ($50.04 billion), exceeding the budgeted yearly revenue by around KD500 million, it said.

Gulf Times – Majority in GCC support single currency union

A survey by the Social and Economic Research Institute (Sesri) at Qatar University has found that a good number of Gulf Co-operation Council nationals think that their countries will benefit from being members of the proposed GCC single currency and that the project will create faster economic growth in their respective countries.

The survey, which was conducted between December 2010 and January 2011 among a total of 2,692 respondents across five GCC countries - Qatar, United Arab Emirates, Saudi Arabia, Bahrain and Kuwait - attempted to seek the opinions of the GCC citizens about the single currency, their awareness and knowledge of the project as well as their support of or opposition to the single currency project.

The survey found that majority of the citizens in Qatar (85%), Bahrain (82%), the UAE (84%) and Saudi Arabia (83%) believed that their countries would benefit from being a member of the GCC single currency while Kuwaitis, on the other hand are less certain about such benefit as 49% of the Kuwaiti respondents said that their country would benefit from being a member of the single currency.

gulfnews : US plays up risks of attacking Iran

The United States has pointedly ramped up its public warnings over the last few weeks about the risks of military action against Iran.

Rhetoric has periodically escalated over the years, often bolstering pushes — like the present one — for tougher sanctions against Iran.

US Defence Secretary Leon Panetta said it risked "an escalation" that could "consume the Middle East in confrontation and conflict that we would regret."

Signs of a slowdown in Emirates' economy - The National

Fresh signs emerged yesterday of a slowdown in the UAE's economy as the latest data showed bank lending dropped while growth in business activity eased.

Bank lending decreased in October for the second month running and deposits continued to fall as funds were withdrawn from the banking system. The slowdown in loan growth coincided with a deceleration of business growth last month, the data shows.

"There's no sign of a recovery in lending and that speaks of more sluggish private-sector growth in the economy," said Liz Martins, the senior Middle East and North Africa (Mena) economist at HSBC.

Overhaul of UAE companies law signals big changes - The National

The biggest overhaul of the country's companies law in almost three decades is set to usher in sweeping changes for businesses.

The new legislation could reduce start-up costs and boost stuttering economic growth throughout the Emirates.

The long-awaited draft of a new companies law was approved by the UAE Cabinet on Sunday.

Global Investment has suspension extended - The National

The protracted struggles of Kuwait's Global Investment House took a new turn yesterday after market regulators extended a suspension of trading in its shares.

The extension came as the company's accumulated losses exceeded 75 per cent of its capital, breaching Kuwaiti market rules.

Global had already halted trading last month pending the release of its third-quarter results, but no transactions have been recorded since the results came out, according to Bloomberg News.

Crude Oil Declines First Day in Three on Possible S&P Credit Downgrades - Bloomberg

Oil declined from the highest in almost three weeks in New York as investors speculated that fuel demand will falter amid signs Europe is struggling to tame its sovereign debt crisis.

Futures slipped as much as 0.6 percent after Standard & Poor’s said it may strip Germany and France of their AAA credit ratings as it put 15 euro nations on review for possible downgrades. A U.S. Energy Department report tomorrow may show gasoline and distillate inventories rose, while crude stockpiles fell, according to a Bloomberg News survey of analysts.

“The market is anticipating the implications to global growth from Europe,” said Michael McCarthy, a chief market strategist at CMC Markets Asia Pacific Pty. in Sydney. “The differential between Brent and West Texas is holding around the $9 level. In the absence of any supply-rattling events we would expect that to close back to parity.”

gulfnews : Saudi outlook stable — Moody’s

International credit rating agency Moody's Investor Services yesterday assigned a stable outlook to the Saudi banking system.

The outlook expresses the agency's expectations for the fundamental credit conditions in the Saudi Arabian banking system over the next 12-18 months.

"The outlook for the Saudi Arabian banking system remains stable based on the country's benign operating environment, the expected decline in problem loan levels, as well as Saudi banks' supportive capital, profitability and liquidity attributes," Moody's said in a report.

IFR-Qatar flexes its muscles with US$5 bln bond deal | Reuters

The wow factor from the State of Qatar's US$5bn Triple Tranche 144a/Reg S bond issue last Tuesday may not have been as strong as it was the last time the state issued in the international markets, but the deal still showed that the gas-rich country is one of the most highly sought after sovereigns.

"After a fairly quiet period for MENA issuance Qatar was exactly the right name to come to market in size," said Andrew Dell, head of debt capital markets, CEEMEA at HSBC. "Yet again they have executed the biggest deal of the year and set the benchmark for the region. What a contrast to the travails of Europe."

HSBC led the deal alongside Citigroup, JP Morgan, Mitsubishi UFJ, QNB Capital and Standard Chartered.

Gulf Times – Qatar, Malaysia to set up $2bn investment fund

Malaysia’s Prime Minister Najib Razak said in a joint press conference with Qatar’s Prime Minister HE Sheikh Hamad bin Jassim bin Jabor al-Thani yesterday that both countries will each put $1bn in a fund to look for investments.

“The Prime Minister of Qatar and I have agreed to work to set up a Malaysia and Qatar investment fund with each country to set up $1bn to look for investments,” Najib said.

He did not elaborate on the type of fund or asset classes that will be invested by the two countries.

HE the Prime Minister Sheikh Hamad bin Jassim bin Jabor al-Thani arrived in Malaysia’s administrative capital yesterday for a three-day visit to strengthen ties between both countries.

gulfnews : UAE markets hope firms' foreign ownership limits will be raised

Listed companies in the UAE may soon be allowed to raise foreign ownership limits beyond 49 per cent as the country's flagging equities scene received a timely boost ahead of next week's MSCI classification review.

The draft Companies Law allows the UAE Cabinet to issue a resolution specifying the types of businesses and sectors in which a foreign partner may hold more than 49 per cent of a company's capital, the UAE Ministry of Economy said in a statement.

Foreign ownership is one of the key obstacles facing the UAE as it seeks an upgrade to emerging market status. Morgan Stanley Capital International (MSCI) will reveal on December 14 whether the UAE has been successful in its bid, which would likely give local bourses a much needed injection of liquidity. However, analysts have warned that the new law might not have much of an immediate impact.

UAE’s non-oil private sector growth slows

The UAE on-oil private sector expanded at a slower pace in November, data from a survey by Markit Economics and HSBC Bank showed on Monday.

The purchasing managers’ index, or PMI, for the non-oil private sector, which measures the performance of the country’s manufacturing and services sectors, dropped to 52.5 in November from 53.4 in October.

A PMI reading above 50 indicates expansion, while one below suggests decline.

Q&A: UAE companies law is updated - The National

The companies law passed by the UAE Cabinet on Sunday includes a long list of provisions.

Here, legal and business experts offer their thoughts on the significance of the new legislation, and how it differs from the old regulations.

gulfnews : UAE keeps its options open

A new giant oil pipeline that will enable the UAE to bypass the strategic Strait of Hormuz waterway by exporting crude via Fujairah will be completed "soon," the country's oil minister said yesterday.

Speaking on the sidelines of the World Petroleum Congress in Qatar's capital, Mohammad Bin Dha'en Al Hameli, UAE Minister of Energy, didn't say when the pipeline would be completed.

The $3.29 billion, (Dh12.07 billion) 400-kilometre pipeline will enable Abu Dhabi to export as much as 70 per cent of its crude from Fujairah on the Arabian Sea, where tankers will be able to pick up the oil instead of sailing an extra day into the Arabian Gulf via the Strait of Hormuz.

24 hours in Dubai: A conversation with SunGard - MoneyScience's blog - MoneyScience

Buy to the roar of cannons; sell to the sound of trumpets – Lord Nathan Rothschild, 1810

This is the poignant Wall Street adage that Abdulhadi Shahadah, CIO for HSBC Saudi Arabia, used when summarising his presentation during a SunGard Dubai City Day event on 23 November. But the pessimism for the next year is palpable. Most market participants in the Gulf Cooperation Council (GCC) of Arab States have the same story – things are slow, likely will be slow next year, expect improvement in 2013.

That 2012 is expected to be another lost year for investment is certainly the narrative in Europe as well. Across the board, economists are revising growth downwards and announcing the arrival of a European-wide recession.

But the context behind this lost year is vastly different for the two regions. While European governments struggle to find a resolution to a seemingly never-ending debt crisis and raise revenues, the oil-rich countries in the Middle East are struggling with attracting liquidity to markets amid the turmoil.

Dubai eyes refinancing of $10bn in state debt -

Dubai has for the first time raised the prospect of restructuring some bonds next year as the emirate and its state-related companies face a wall of $10bn in debt repayments.

The emirate is also pursuing other options, including raising $2bn in funds from liquid local banks, as it helps government-related entities meet their obligations, including three bonds totalling $3.8bn that mature during the course of next year.

“We are working hard to meet all our liabilities but times are different,” a senior government official said. “We are more confident we can negotiate a commercial deal with bondholders.”