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Monday, 16 October 2017

Saudi Aramco: a blow for Mohammed bin Salman

Mideast benefits as investors look further afield

Mideast benefits as investors look further afield:

"As investors brace themselves for a shift in monetary policy across developed markets and trillions of euros of debt still trade at negative yields, it is no surprise that many have looked further afield for returns this year.

Middle Eastern countries, in particular, have been big beneficiaries of a hunt for yield, with the region selling by far the largest annual volume of sovereign and local authority debt on record.

While these bonds have typically been denominated in dollars, to which Middle Eastern currencies are pegged, some investors point to the attractiveness of local currency bonds as a means of further boosting fixed income returns."



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Why Kurdish Oil Is a Wild Card for Markets - Bloomberg

Why Kurdish Oil Is a Wild Card for Markets - Bloomberg:

"If Iraq’s Kurdish territory were a country, it would probably qualify for OPEC membership. It wouldn’t even be the smallest member, given its production of more than half a million barrels of oil a day. That’s an impressive achievement for a landlocked enclave that started exploring only a decade ago. The region’s potential is greater still, though it faces political, military and economic challenges to expanding its output.

Tensions over a Sept. 25 independence referendum in the semi-autonomous oil province have flared into open conflict between the federal authorities and the Kurdistan Regional Government. The KRG included the disputed oil-rich territory of Kirkuk in the vote, prompting clashes between troops from both sides and an Iraqi military thrust to seize oil facilities from Kurdish forces.

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Dubai Holding sidelines $20 billion property project

Dubai Holding sidelines $20 billion property project:

"Dubai Holding has put on hold plans to develop Jumeirah Central, its $20 billion office, retail and residential project in the heart of Dubai, it said on Monday. “Dubai Holding is prioritizing projects that will be ready for Expo 2020 Dubai and those that will help draw tourists to the emirate. As a result, we are currently focusing our resources on projects such as Marsa Al Arab,” it said. Dubai is hoping to attract 20 million visitors a year by 2020 when it will host the World Expo 2020 exhibition."



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Exclusive: China offers to buy 5 percent of Saudi Aramco directly - sources

Exclusive: China offers to buy 5 percent of Saudi Aramco directly - sources:

"China is offering to buy up to 5 percent of Saudi Aramco directly, sources said, a move that could give Saudi Arabia the flexibility to consider various options for its plan to float the world’s biggest oil producer on the stock market.

Chinese state-owned oil companies PetroChina (0857.HK) and Sinopec (0386.HK) have written to Saudi Aramco in recent weeks to express an interest in a direct deal, industry sources told Reuters. The companies are part of a state-run consortium including China’s sovereign wealth fund, the sources say.

Saudi Arabia’s Crown Prince Mohammed bin Salman said last year the kingdom was considering listing about 5 percent of Aramco in 2018 in a deal that could raise $100 billion, if the company is valued at about $2 trillion as hoped."



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Saudi Arabia Needs Lots of Private Oil Money - Bloomberg Gadfly

Saudi Arabia Needs Lots of Private Oil Money - Bloomberg Gadfly:

"Saudi Arabia is considering a staggered process for the colossal initial public offering of its state oil company, according to an FT report. That could potentially involve a local IPO of Saudi Aramco in Riyadh alongside a private placement to cornerstone investors, with an international sale following later.ARAMCO MOOTED VALUE$2 trillionWhatever structure Aramco opts for, the sheer size of the offering means shareholders taking hefty stakes would have to be an essential part of its privatization. This was always going to be an IPO roadshow taking in the world's richest individuals and institutions.Saudi Arabia is considering selling about 5 percent of the company. At the mooted -- but contested -- $2 trillion valuation, that would imply a stock offering of at least $100 billion. This is about half of the natural demand for global IPOs based on recent figures. In the past 12 months, $206 billion of stock was sold in new issues, including $95 billion of new stock sales in Asia, $52 billion in Europe and $43 billion in the U.S, Bloomberg data show."



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MIDEAST STOCKS-Saudi market rebounds on banks, oil prices

MIDEAST STOCKS-Saudi market rebounds on banks, oil prices:

"Saudi Arabia’s stock market rebounded on Monday as higher oil prices boosted petrochemical shares while banks rose in response to Alinma Bank’s better-than-expected earnings. The main Saudi index gained 0.6 percent as tensions between Baghdad and Iraqi Kurdistan lifted oil sharply. PetroRabigh rose 2.1 percent and Petrochem added 1.2 percent, while mining firm Ma‘aden was up 2.1 percent. Alinma Bank jumped 5.1 percent and was the most heavily traded stock; it reported third-quarter net profit of 542 million riyals ($145 million), up from 312 million riyals a year ago. Analysts had on average forecast 493 million riyals."



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Dubai Aerospace plans sukuk issue by mid-2018

Dubai Aerospace plans sukuk issue by mid-2018:

"Dubai Aerospace Enterprise (DAE) intends to tap the Islamic bond market within the next nine months as part of a strategy to diversify the company’s funding, its chief executive said on Monday. The Dubai government-controlled company became one of the world’s largest aircraft lessors in August after acquiring Dublin-based AWAS. DAE Chief Executive Firoz Tarapore told Reuters that the company intended to issue a sukuk “very soon”. Asked if that could take place by the middle of 2018, Tarapore answered “most definitely.”"



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Abu Dhabi Investment Authority's unit to invest $1bln in India's infra fund | ZAWYA MENA Edition

Abu Dhabi Investment Authority's unit to invest $1bln in India's infra fund | ZAWYA MENA Edition:

"MUMBAI- India's National Investment and Infrastructure Fund (NIIF) on Monday said it signed a $1 billion investment deal with a unit of Abu Dhabi Investment Authority (ADIA) - one of the largest sovereign wealth funds in the world.

NIIF, a quasi-sovereign wealth fund, said ADIA will become the first institutional investor in its master fund.

The corpus of NIIF, created by the Indian government to boost infrastructure financing, is proposed to be about $6 billion, with a 49 percent investment from the government. "



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MIDEAST STOCKS-Gulf markets firm, Saudi rises on banks | ZAWYA MENA Edition

MIDEAST STOCKS-Gulf markets firm, Saudi rises on banks | ZAWYA MENA Edition:

"Most Gulf stock markets were firm in early trade on Monday with Saudi Arabia recovering from Sunday's losses as the banking sector rose on Alinma Bank's better-than-expected earnings. The main Saudi index edged up 0.2 percent in the first hour. Alinma Bank jumped 2.3 percent and was the most heavily traded stock; it reported third-quarter net profit of 542 million riyals ($145 million), up from 312 million riyals a year ago. Analysts had forecast an average of 493 million riyals. Other Saudi banks, which have yet to report earnings, were generally firm; Al Rajhi Bank was up 0.6 percent. "



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Aramco exposes Gulf in governance rhetoric | FT Alphaville

Aramco exposes Gulf in governance rhetoric | FT Alphaville:

"Aramco exposes Gulf in governance rhetoric. FT Opening Quote, with commentary by Matthew Vincent, is your early Square Mile briefing. You can sign up for the full newsletter here.

News that Saudi Aramco, the Gulf state’s $1tn oil company, may postpone plans for an international listing of its shares – and instead sell a stake to sovereign wealth funds – is a tad embarrassing for Theresa May.

It not only makes her April trip to lobby the Saudi’s for a London listing – taking stock exchange boss Xavier Rolet – look like a waste of time. It also suggests she may have compromised her position as First Lord of the Treasury and Grand Upholder of the Corporate Governance Standards for nothing."



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Aramco confirms IPO on track for 2018 - The National

Aramco confirms IPO on track for 2018 - The National:

"Saudi Aramco, the world’s largest energy company, has confirmed its record-breaking public listing is on track for next year, dismissing media reports it was considering abandoning the process.

The Financial Times reported on Friday that Aramco was considering “shelving” its 2018 listing of approximately 5 per cent of its shares, a sale that is expected to raise about US100 billion, in favour of a private placement to sovereign wealth funds and institutional investors.

“[The] FT report on Saudi Aramco IPO is entirely speculative,” the company said in a statement on Twitter on Sunday."



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Saudi Arabia’s Great Makeover Can’t Afford to Fail This Time - Bloomberg

Saudi Arabia’s Great Makeover Can’t Afford to Fail This Time - Bloomberg:

"Visitors to Saudi Arabia could be forgiven for thinking the country just got a dynamic young new king. Images of him holding babies, drinking coffee with soldiers or meeting the world’s most powerful rulers are all over television. On National Day last month, a giant picture of him was projected onto a Riyadh skyscraper. Crown Prince Mohammed bin Salman, 32, has emerged as the unrivaled leader of the kingdom, now better placed to steer it through a transition no nation in history has managed to pull off: converting a major economy reliant on petrodollars into one that can survive in a post-oil 21st century.  The grand remake involves investing in new industries and creating jobs for the young Saudi population. It will all be underpinned by the sale of a stake in oil giant Aramco, which is now facing possible delay, and the creation of the world’s biggest sovereign wealth fund."



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Oil jumps on fears of new Iran sanctions, Iraq conflict

Oil jumps on fears of new Iran sanctions, Iraq conflict:

"Oil markets jumped on Monday on concerns over potential renewed U.S. sanctions against Iran as well as conflict in Iraq, while an explosion at a U.S. oil rig and reduced exploration activity supported prices there.

International Brent crude futures LCOc1 were at $57.82 at 0645 GMT, up 65 cents, or 1.1 percent, from the previous close.

Prices were being pushed up by worries over renewed U.S. sanctions against Iran. "



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Saudi Wealth Fund Said to Hire Development Head From Qatari Diar - Bloomberg

Saudi Wealth Fund Said to Hire Development Head From Qatari Diar - Bloomberg:

"Saudi Arabia’s sovereign wealth fund hired the head of Qatar Investment Authority’s real estate arm as its chief development officer earlier this year amid plans to invest billions of dollars in tourism and property projects, according to people familiar with the matter. Greg Bankhurst, formerly chief executive officer of Qatari Diar, joined the Public Investment Fund, the people said, asking not to be identified as the information is private. Bankhurst started working at the fund in June, according to his LinkedIn profile. Jayson Miragliotta also joined as executive director of master planning in August, the people said. He previously held roles at Dubai-based Emaar Properties PJSC and Majid Al Futtaim, according to Miragliotta’s LinkedIn profile."



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