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Thursday, 5 January 2012

U.S. Private Equity Shop, Abu Dhabi Investment Firm Clash Over Default Claim - Forbes

An investment firm linked to Abu Dhabi’s royal family is embroiled in a nasty fight with a U.S. private equity shop that claims the Abu Dhabi firm defaulted on its capital commitments and forfeited a more than $20 million investment.

Emirates International Investment Company has initiated an arbitration proceeding against ECP MENA Growth Fund, a poorly performing fund of $1.8 billion Washington D.C. private equity firm Emerging Capital Partners, and claimed in a recently filed lawsuit that ECP has invoked a “draconian interpretation of the default provisions as a retaliatory measure to cause maximum financial harm.”

Monti Says Any Iranian Oil Ban Should Be Gradual, Exclude Sales to Pay Eni - Bloomberg

The leader of financially struggling Italy questioned the scope and timing of a possible European Union halt to Iranian oil purchases, raising an obstacle to stiffer sanctions on Iran’s nuclear activities.
Penalties set to be announced on Jan. 30 should be phased in and exempt crude sold by Iran to pay off debts to Eni SpA (ENI), Italy’s largest oil company, Prime Minister Mario Monti said.
“An oil embargo is conceivable as long as it remains gradual and excludes the deliveries that serve to reimburse the billion euros in debts that Iran owes to Eni, our national company,” Monti told France’s Le Figaro in an interview published today.

MENA stock markets close - January 5, 2012

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)

Nakheel negotiates $272m contractor claims | Alrroya

Troubled Dubai developer Nakheel has negotiated contractor claims worth Dh1 billion ($272.24 million) so far and hopes to issue the second tranche of its Islamic bond within the next six months, its chairman said on Thursday.

"So far we have been successful in the negotiations," Ali Rashid Lootah told reporters at the Nakheel headquarters in the man-made island Palm Jumeirah.

"We dealt with the claims of one billion dirhams," Lootah said.

Aldar bonds may still offer value after yield plunge | Alrroya

Bondholders in Abu Dhabi property developer Aldar Properties, which received yet another government lifeline last week, have seen the yield on its 2014 high-yield bond tumble to historic lows this week. But the company's debt may still offer value to investors looking for exposure to Abu Dhabi.

The yield on Aldar's $1.25 billion, 10.75 per cent bond maturing 2014 dropped to 5.52 per cent on Wednesday, the lowest since issue in 2009. That was about 350 basis points tighter than in early October, when spreads of Gulf high-yield bonds in general widened sharply because of jitters about the euro zone debt crisis.

By contrast, the struggling developer's share price has slumped to record lows in recent weeks because of fears of share dilution and an eventual delisting. The company has officially denied it has any plans to delist from the Abu Dhabi stock exchange.

Dana Gas $1bn sukuk yield surges on debt repayment risk | Alrroya

Dana Gas PJSC’s Islamic bonds surged to a record after the company failed to provide details on how it plans to repay $1 billion of sukuk maturing in October.

The yield on the 7.5 per cent Shariah-compliant notes jumped 425 basis points, or 4.25 percentage points, to 44.6 per cent at 3:05 pm in Dubai. The price sank to 75.99 cents on the dollar. Dana Gas shares fell 2.2 per cent, the most in more than a week, to 44 fils after plunging 38 per cent last year.

The company’s board yesterday considered updates on its stake in Mol Nyrt as well as on financing projects in Egypt and the United Arab Emirates, Dana Gas said today, without giving further details. Dana Gas’s unlisted parent Crescent Petroleum Co owns 3 per cent of Mol, Hungary’s largest oil refiner, according to data compiled by Bloomberg.

International Adviser: ESCA tipped to be ‘wholesale regulator’ for UAE

The Emirates Securities & Commodities Authority (ESCA) is likely to become the “wholesale regulator” in the UAE, regulating life companies to IFAs, according to HSBC’s Daniel Rudd.
Rudd, the bank’s head of wholesale distribution for the MENA region, said it is only a matter of time before ESCA, which was created in 2000, takes charge of all aspects of financial regulation.

The regulation of financial institutions in the UAE is currently shared between the UAE Central Bank, with which most asset management companies are registered; the Insurance Authority, with which most international life companies and IFAs are registered; and the Dubai Financial Services Authority, which regulates activities in the DIFC.

Dubai Shares Fall a 3rd Day This Week Before Quarterly Earnings - Bloomberg

Dubai’s benchmark stock (DFMGI) index declined for a third day this week before companies in the emirate report fourth-quarter earnings and as Asian markets retreated amid concern Europe’s debt crisis is worsening.
Emaar Properties PJSC, (EMAAR) developer of the world’s tallest skyscraper, decreased 1.2 percent and property company Deyaar Development (DEYAAR) PJSC headed for the biggest drop since Dec. 26. The DFM General Index (DFMGI) lost 0.4 percent to 1,341.73 at 11:31 a.m. in Dubai. The Bloomberg GCC 200 Index (BGCC200) slipped 0.2 percent and Abu Dhabi’s ADX General Index (ADSMI) fell 0.4 percent.
“Investors are pulling back before fourth-quarter results and there is generally a lack of catalysts in the markets,” said Waleed Al Khateeb, senior finance manager at Dubai-based Daman Securities LLC. “Some real estate companies may disappoint.”

UPDATE 1-Japan's JX looks to Saudi for oil on Iran worries | Reuters

Japan's biggest refiner JX Nippon Oil & Energy Corp is talking with top exporter Saudi Arabia and other oil producers to source crude to replace any disruption to its imports from Iran, the company's president said on Thursday.

Fresh U.S. sanctions on Iran over its nuclear programme could make it difficult for refiners in Japan, Iran's number three crude buyer, to pay Tehran for its oil.

Japan is seeking an exemption to U.S. sanctions that President Barack Obama signed into law on Saturday. The sanctions, if enforced, would penalise financial institutions for undertaking transactions with Iran's central bank, exposing the U.S. operations of Japanese banks that deal with Iran.

FEATURE-Khartoum bourse woos foreign funds with electronic trade - Yahoo!

Glancing at stock market prices scribbled in columns on large white boards, Sudanese broker Maha Abdul-Rahim hopes a new electronic trading system will bring more money to the Khartoum Stock Exchange.
The bourse plans to launch a computer-based trading system next week, ending the practice of having brokers write share price offers on boards -- if a deal is reached, a bourse
employee crosses out the numbers and prints out a paper to be signed by buyer and seller.
"The new system will achieve more transparency. You will know the identity of sellers," said Abdul-Rahim, while signing papers after the daily one-hour trading session.

Exclusive: EU agrees to embargo on Iranian crude - Yahoo!

European governments have agreed in principle to ban imports of Iranian oil, EU diplomats said on Wednesday, dealing a blow to Tehran that crowns new Western sanctions months before an Iranian election.
The prospective embargo by the European Union, along with tough U.S. financial measures signed into law by President Barack Obama on New Year's Eve, form a concerted Western campaign to hold back Iran's nuclear program.
Iran says the program is strictly non-military, but Western countries say a November U.N. report shows it has sought to build an atomic bomb. Talks between Tehran and major powers broke down a year ago.

gulfnews : Gulf Petrochem to invest in Fujairah

Gulf Petrochem Group will invest $136.4 million (Dh500.89 million) to develop a 412,000 cubic metre storage terminal project in Fujairah in which Fujairah Petroleum Company (FPC) has signed an agreement with Gulf Petrochem to buy a 12 per cent stake, a senior executive of Gulf Petrochem said yesterday.
Sanjeev Sisaudia, Group Chief Executive for Gulf Petrochem, told Gulf News, "FPC will also invest as per the agreement". He didn't elaborate.
Gulf Petrochem recently signed an investment agreement with the Government of Fujairah subsidiary Fujairah Petroleum Company (FPC).

gulfnews : Global uncertainty causes slump in UAE non-oil sector's output

Business growth in the UAE's non-oil private sector slumped to a four month low in December, according to the latest HSBC Purchasing Managers' Index (PMI).
Output and new order growth both rose at weaker rates last month while employment levels stagnated, the report said. The situation is also unlikely to improve dramatically in the first quarter of 2012 because of the gloomy global economic scenario.
The HSBC PMI, which measures business activity of 400 private firms in the UAE across manufacturing, services, construction and retail sectors, dropped to 51.7 points in December from 52.5 points in November. The adjusted index remains above the 50-point mark which separates growth from contraction. "Output from the UAE non-oil private sector continued to rise during the latest survey period," the HSBC report said. "However, the rate of increase moderated since November to a three-month low, reflecting an easing trend in new business growth and a less-marked depletion of unfinished work," it added.

Regional advertising spending hit by turmoil - The National

Advertising spending in the Arab world declined by 10 per cent last year, according to one of the world's largest media groups.

Unrest in Egypt and Bahrain helped to drag down the multibillion-dollar industry, although markets such as Saudi Arabia and the UAE proved resilient.

Elie Khouri, the chief executive of Omnicom Media Group in the Middle East and North Africa (Mena), dismissed a report released yesterday that suggested a slight rise in advertising spending last year.

Hiring in private sector loses pace - The National

Private-sector employment growth stalled last month for the first time in more than two years - further evidence of a loss of momentum in the UAE economy.

Only 5 per cent of companies took on workers during the month, according to HSBC's purchasing managers index (PMI). But recruitment growth remained largely flat as 5 per cent of companies also shed employees.

Average wages and salaries fell for the first time since November 2010.

Saudi jet deal delay threatens BAE earnings -

Delays to BAE Systems’ Eurofighter jet deal with Saudi Arabia could hit the defence company’s 2011 earnings, BAE warned in a statement on Wednesday.
Negotiations over the price escalation of the deal, which was initially valued at £4.5bn-£10bn, for 72 Eurofighter Typhoon jet fighters, will continue into 2012, rather than having been completed in 2011 as the company and many analysts had hoped.
Nevertheless, analysts called the news broadly positive, especially for 2012 and beyond. BAE’s shares, however, fell 7.6p to 287.3p.