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Tuesday, 17 April 2012

Azerbaijan: more gas on the way | beyondbrics – FT.com

ExxonMobil has just consummated its strategic partnership with Rosneft so it’s nice for BP, which failed last year in its attempt to tie up with the Russian state oil company, to have something positive to report.

The UK major announced plans on Tuesday to begin the design work for the second phase of the huge Shah Deniz gas project that will supply Caspian gas to European markets and help reduce their dependence on Russian energy supplies.

The launch of the so called FEED or Front End Engineering and Design phase does not signal a final commitment to proceed with Shah Deniz, but it’s a “big step in the right direction,” said Toby Odone, BP spokesman. “We are doing it step by step and keeping to a tight schedule.”

Dubai’s Tamweel Q1 net profit down 33% - Travel & Hospitality - ArabianBusiness.com

Dubai-based sharia-compliant mortgage lender Tamweel posted a 33 percent fall in first quarter net profit, hit by litigation provisions.
Tamweel, majority owned by Dubai Islamic Bank (DIB) made a net profit of AED18m (US$4.9m), after a one-time provision of AED21.6m for possible, unspecified litigation losses.
Operating profit before provisions rose 13 percent to AED48.5m.

Paying dearly to do business in dicey Dubai

IF SECRETIVE, opulent Monaco can be considered a sunny place for shady people, what does that make the oil-rich state of Dubai in the Middle East?

For investors and entrepreneurs it has proved a dicey place to do business, where contracts and courts have a mind of their own and the cycle of boom and bust is supercharged by barrels upon barrels of petroleum.

Australia's Hastie Group has discovered just how dangerous to your wealth Dubai can be as its $6.2 million construction dispute with Dutco Balfour Beatty grinds through the courts and it stands to lose that sum of money plus another $8 million to $10 million in unpaid bills that the ASX-listed company has already written off.

MIDEAST STOCKS-SABIC Q1 helps Saudi rebound; poll woes weigh on Egypt - Yahoo! News UK

Bellwether Saudi Basic Industries Corp (SABIC) made its largest daily gain in nearly 11 months on Tuesday after its earnings beat forecasts, helping lift the bourse from seven-week lows, while Egyptian shares fell on election uncertainty
SABIC jumped 4.3 percent to 102.25 riyals in its largest daily gain since March 2011.
SABIC said first-quarter net profit fell 5 percent to 7.27 billion riyals ($1.94 billion) from a year earlier on higher
input prices. Analysts polled by Reuters on average forecast the firm would post a profit of 6.7 billion riyals.

UPDATE 1-Saudi Savola Q1 net profit up 47 pct, beats views - Yahoo! News UK

Saudi food and drink manufacturer Savola Group recorded a 46.7 percent jump in first-quarter net profit, beating forecasts.
The firm reported earnings of 242.2 million riyals ($64.6 million), up from 165.2 million riyals a year earlier, according to a statement posted on the bourse website.
The result beat a survey of five analysts who forecast on average it would earn 235 million in the period. In January Savola said it would likely have first-quarter net income of 220 million riyals before capital gains.

Qatar buys into Libyan bank | beyondbrics – FT.com

Qatar’s top bank has purchased a major stake in one of Libya’s leading privately held financial institutions. The deal strengthens the commercial ties between two countries already bound together politically in the wake of the Arab Spring uprisings.

Following months of negotiations, Qatar National Bank, the energy-rich Arabian Peninsula kingdom’s largest financial institution, paid an undisclosed sum for a 49 per cent stake in the Bank of Commerce and Development.

According to a press release, the deal was announced at an extraordinary April 12 meeting in the eastern Libyan city of Benghazi, where peaceful protests against the dictatorship of Col Muammer Gaddafi evolved into an armed uprising against his rule backed by Qatar, Nato and other countries.

Abu Dhabi's Invest AD bets big on Africa | Reuters

Abu Dhabi-owned fund Invest AD is betting on its range of investment products to tap growth opportunities in fast-growing Africa, a continent which the state-owned investment firm believes is still undervalued for its potential.

"If you look at Africa, there are opportunities across the board and it's not as well-defined as in some other more mature markets. So we want to build a suite of products that captures that growth," Chief Investment Officer David Sanders said in an interview.

As part of the move, Invest AD has converted its existing Emerging Africa Fund to a Ucits standard fund -- viewed as more regulated, transparent and liquid -- to lure risk-averse European investors, Sanders said. The fund expects to be $40 million in size by the end of May.

Arab Spring takes toll on investment banking fees - Financial Services - Zawya

Dubai: Investment banking fees earned by banks operating in the Middle East and North Africa (Mena) declined 8 per cent in the first quarter of 2012, according to data compiled by Thomson Reuters .

“Investment banking fees fell this quarter continuing last year’s trend as the Arab Spring continues to take its toll on the banking sector.

“This quarter was the lowest quarter for fees in the region since the second quarter of 2005,” said Russell Haworth, Managing Director, Middle East and Africa at Thomson Reuters .

Kuwait’s Global Investment Will Meet Bondholders on April 24 - Bloomberg

Global Investment House KSCC, a Kuwaiti investment bank that reorganized $1.73 billion of debt in 2009, said it will meet bondholders on April 24 as part of the restructuring process.
There will be separate meetings in Kuwait City with holders of its 50 million-dinar ($180 million) bond and of its 45 million-dinar bond, the bank said in a statement distributed on the Regulatory News Service.

UPDATE 1-Mubadala in billion dollar deal with Boeing | Reuters

Abu Dhabi fund Mubadala's aerospace division unveiled a $1 billion contract to build carbon-composite structures for Boeing, boosting the United Arab Emirates' efforts to become a key manufacturer for the aerospace industry.

The 10 year deal calls for the Mubadala Aerospace to produce ribs, or strengthening components, for the tail section of the 777 mini-jumbo and the vertical part of the tail for the 787 Dreamliner, Boeing's latest passenger jet.

It also marks the first time, Boeing said, of a direct outsourcing deal for composites production in the Arab world. Airline manufacturers are using more and more lightweight composite materials in their aircraft to boost fuel efficiencies.

Morocco's state-controlled airline seeks partner | Reuters

Morocco's state-controlled Royal Air Maroc is seeking a larger strategic partner, a senior airline official said, as it battles to regain profitability and stand up to increased competition from low cost carriers.

The cash-strapped Moroccan government bailed out Royal Air Maroc last year to the tune of $193 million and gave it an additional $900 million to upgrade itself by 2016.

The generous handout fuelled speculation among members of parliament that the flag carrier was souping itself up ahead of the sale of a substantial stake to a foreign operator.

JCorp sukuk may yield less than AAA issuers

Johor Corp, an unrated Malaysian investment company, will probably pay less than AAA issuers to sell US$976 million of sukuk on local-government guarantees, according to MCIS Zurich Insurance Bhd and Bangkok Bank Bhd.

Johor Corp, which defaulted on its debt in 2001, may price the 10-year Islamic notes to yield 30 basis points more than non-Islamic sovereign bonds, equivalent to 3.83 per cent yesterday, the Kuala Lumpur-based units of MCIS Zurich and Bangkok Bank say. Builder Pembinaan BLT Sdn paid 4.13 per cent for a similar offering last month and highway operator PLUS Bhd set a coupon rate of 4.4 per cent on its syariah-compliant securities. Both issuers are rated AAA.

The investment unit is owned by Malaysia’s southern-most state of Johor, which is seeking to transform itself from one of the poorest regions in the country by building ports, oil facilities and industrial complexes to compete with richer neighbour Singapore.

Saudi Non-Oil Sector Was 73% of GDP in 2011, Arab News Reports - Bloomberg

Saudi Arabia’s non-oil sector contributed 73 percent to real gross domestic product in 2011, Arab News reported, citing a speech by Economy and Planning Minister Muhammad al-Jasser.
Saudi cement (SACCO) production was 62 million tons last year, the Jeddah-based newspaper cited him as saying.

Tamweel May Tap Debt Market Again This Year, Acting CEO Says - Bloomberg

Tamweel PJSC (TAMWEEL) may consider tapping the debt market again this year after the United Arab Emirates mortgage lender raised $300 million from the sale of Islamic bonds in January.
“We may potentially go back to the market this year for either a sukuk or securitization,” acting Chief Executive OfficerVarun Sood said in an interview in Dubai today. “It would be a similar transaction to what we did earlier this year.”
The mortgage company, controlled by Dubai Islamic Bank PJSC (DIB), sold $300 million in sukuk in January, its first offering since 2008. The yield on its 5.154 percent bonds due January 2017 was at 5.13 percent today, according to data compiled by Bloomberg.

Egypt: devaluation risks multiply | beyondbrics – FT.com

Currency traders are betting against Egypt in droves. While the central bank battles valiantly to keep the exchange rate at around 6 to the US dollar in the cash market, the Egyptian pound’s value is plunging in futures trading.

On Monday, the 12-month non-deliverable forward rate hit 7.45, its weakest-ever level, suggesting that traders expect a devaluation of nearly 20 per cent. The finance ministry tried to boost confidence by setting a new date – May 15 – for winning approval for the country’s much-delayed International Monetary Fund assistance. But with Cairo in political crisis, Washington will be in no hurry to ride to the rescue.

The latest futures sell-off comes amid the uncertainty generated by the surprise decision by Egypt’s election commission to bar the candidacies of 10 of the 23 candidates in next month’s presidential election.

Abu Dhabi fund to take 2 seats on UniCredit board | Reuters

Abu Dhabi investment vehicle Aabar, UniCredit's biggest single shareholder, will have two seats in the Italian bank's new, slimmed-down board, according to a list of board nominees presented on Monday.

The new board will have 19 members, down from 23. Aabar, which has a 6.5 percent stake in UniCredit, said its chairman, Kadem Abdulla al-Qubaisi, and Ferrari Chairman Luca Cordero di Montezemolo would be its representatives.

The bank's core foundation shareholders have named seven board members as they seek to keep their grip on Italy's biggest bank by assets.

Dubai's Emirates airline mulls foreign buys | Reuters

Dubai's Emirates airline is studying new opportunities to buy foreign carriers if they fit the emirate's strategy, the state news agency quoted the chairman of the fast-growing carrier as saying on Monday.

"Now there are studies for various opportunities to acquire international carriers... if they fit the Dubai business model," United Arab Emirates news agency WAM cited the airline's chairman Sheikh Ahmed bin Saeed al-Maktoum as saying.

"Anything to do with aviation and our business, if it is at the right price, we are always interested," Sheikh Ahmed said at an aerospace conference in Abu Dhabi, the capital of the UAE.

Eight UAE companies accused by EU - The National

The European Union has placed the names of eight companies based in the UAE on a list of entities suspected to have links to Iranian military programmes.

An accountancy firm and seven shipping companies were included on a list of companies ordered to have any assets they hold in Europe frozen.

The measures were agreed by the EU in December as part of sanctions against Iran.

UPDATE 1-Saudi Mobily Q1 profit up 21 percent | Reuters

Saudi Arabia's Etihad Etisalat (Mobily) on Monday reported a 21 percent rise in first-quarter net profit, just short of analysts' estimates, citing improved revenue from voice services and business customers.

Mobily, an affiliate of the United Arab Emirates' Etisalat , made a profit of 1.207 billion riyals in the three months to March 31, up from 998 million riyals in the year-earlier period, the company said in a statement on the bourse website.

Analysts polled by Reuters on average forecast Mobily would make a quarterly profit of 1.3 billion riyals.

Saudi Oil-Led Growth Lures StanChart as Barclays Targets Wealthy - Businessweek

Standard Chartered Plc (STAN), the U.K. bank that depends on Asia for most of its profit, and Barclays Plc (BARC) are expanding in Saudi Arabia as oil above $100 a barrel and record bond sales bolster earnings in the biggest Arab economy.

“We’d be crazy to limit ourselves to a handful of bankers when we can see oil prices are going to sustain the Saudi economy for the foreseeable future,” Rory Gilbert, the head of Middle East and North Africa at London-based Barclays’s wealth management unit, said in an interview this week in Dubai. “In four or five years, we’ll have a much broader presence in Saudi Arabia.”

Barclays is expanding operations to target more millionaires, according to Gilbert. Standard Chartered, also based in London, started a capital markets office in Saudi Arabia, Viswanathan Shankar, the bank’s chief executive officer for the Middle East, Europe, Africa and the Americas, said in an interview at a Bloomberg conference in Doha, Qatar yesterday.