Investors in Egypt have to weigh the attractions of low costs and a growing consumer market against the prospect of political instability. So it’s a modest victory for the country’s government that the world’s second largest white goods manufacturer has decided the opportunities outweigh the risks. Sweden’s Electrolux is paying up to $480m for a leading Egyptian white goods manufacturer, Olympic Group.
Electrolux announced earlier this week that it will acquire Paradise Capital’s 52-per-cent stake in Olympic, and will then make an obligatory tender offer for the rest of the company. The agreed price per share is $8, representing a 50-per-cent premium on Olympic Group’s prior to the announcement. The total value of the transaction could reach $480m.
Olympic Group, which has a 30-per-cent share of the Egyptian market, already had a distribution and manufacturing partnership with Electrolux which goes back three decades. Analysts say that an acquisition makes sense for Electrolux, allowing it to cut production costs and to tap further into Arab and African markets, with their young populations. Electrolux’s shares rose over 4 per cent on news of the deal.
Thursday, 14 October 2010
Abu Dhabi Shares Rise to 5-Month High as Etisalat Gains on Zain, Outlook - Bloomberg
Abu Dhabi shares increased to the highest level in almost five months after Etisalat is said to have started talks with banks to finance its purchase of a stake in Kuwait’s Mobile Telecommunications Co.
Etisalat, or Emirates Telecommunications Corp., climbed to the highest since March. The company has the biggest weighting on Abu Dhabi’s ADX General Index, which rose 0.5 percent to 2,758.67 at the 2 p.m. close in the emirate. The gauge increased 2.7 percent this week and closed at the highest since May 20. Dana Gas PJSC, the U.A.E. energy company, gained the most in four weeks.
Etisalat buying a stake in Zain “will have a positive impact on its financial statement” and third-quarter earnings “are expected to be good,” said Kifah Maharmeh, general manager at Al Dar Shares & Bonds Brokerage in Abu Dhabi.
Etisalat, or Emirates Telecommunications Corp., climbed to the highest since March. The company has the biggest weighting on Abu Dhabi’s ADX General Index, which rose 0.5 percent to 2,758.67 at the 2 p.m. close in the emirate. The gauge increased 2.7 percent this week and closed at the highest since May 20. Dana Gas PJSC, the U.A.E. energy company, gained the most in four weeks.
Etisalat buying a stake in Zain “will have a positive impact on its financial statement” and third-quarter earnings “are expected to be good,” said Kifah Maharmeh, general manager at Al Dar Shares & Bonds Brokerage in Abu Dhabi.
U.A.E.'s Ras Al Khaimah Said to Plan Sale of Benchmark Bond, Hires Banks - Bloomberg
Ras Al Khaimah, one of the seven sheikhdoms that make up the United Arab Emirates, plans to sell a so-called benchmark bond and has hired two banks to manage the transaction, two bankers familiar with the plan said.
Citigroup Inc. and Royal Bank of Scotland Group Plc will manage the sale, said the Dubai-based bankers, who declined to be identified because the information is private. A benchmark- sized bond usually raises at least $500 million.
Ras Al Khaimah last sold a bond in July 2009, when it raised $400 million from an Islamic ijarah sukuk, Bloomberg data shows. A spokesman for Ras Al Khaimah could not immediately be reached for comment. A spokesman for Citigroup declined to comment as did a spokeswoman for Royal Bank of Scotland.
Citigroup Inc. and Royal Bank of Scotland Group Plc will manage the sale, said the Dubai-based bankers, who declined to be identified because the information is private. A benchmark- sized bond usually raises at least $500 million.
Ras Al Khaimah last sold a bond in July 2009, when it raised $400 million from an Islamic ijarah sukuk, Bloomberg data shows. A spokesman for Ras Al Khaimah could not immediately be reached for comment. A spokesman for Citigroup declined to comment as did a spokeswoman for Royal Bank of Scotland.
Citadel Resources courts majors to help make Saudi inroads | The Australian
The Saudi business recently grew to a market value of $1 billion, through talks with some of the world's biggest miners about teaming up on exploration projects in the Middle Eastern nation.
Chief executive Ines Scotland said six of the "majors" had been looking at joining with Citadel to shore up the early stage Wadi Kamal nickel, copper and platinum exploration licence and the Bari copper and gold prospect.
She would not say who the companies were but said that her definition of a major included her former employer Rio Tinto.
Chief executive Ines Scotland said six of the "majors" had been looking at joining with Citadel to shore up the early stage Wadi Kamal nickel, copper and platinum exploration licence and the Bari copper and gold prospect.
She would not say who the companies were but said that her definition of a major included her former employer Rio Tinto.
U.A.E. 2011 Growth Forecast Cut to 2.9% at EFG-Hermes on Slower Spending - Bloomberg
The United Arab Emirates economy may grow 2.9 percent next year, investment bank EFG-Hermes Holding SAE said today, lowering its forecast from 3.4 percent on fewer expected projects in Abu Dhabi and slower spending in Dubai.
The change comes “on signs of weaker-than-expected project implementations in Abu Dhabi and lower oil production increases,” economists Monica Malik and Mohamed Abu Basha wrote in the quarterly report released today. “Deleveraging, further Dubai Inc. restructuring, falls in real estate prices, and fiscal retrenchment in Dubai should result in a weak domestic demand environment in the medium term.”
The International Monetary Fund said on Oct. 6 that it expected the U.A.E. economy to expand 3.2 percent in 2011, adding that the “health of the corporate sector” remains a challenge. Dubai World, one of the emirate’s three main holding companies, last month said it secured approval from creditors to change the terms on $24.9 billion of debt.
The change comes “on signs of weaker-than-expected project implementations in Abu Dhabi and lower oil production increases,” economists Monica Malik and Mohamed Abu Basha wrote in the quarterly report released today. “Deleveraging, further Dubai Inc. restructuring, falls in real estate prices, and fiscal retrenchment in Dubai should result in a weak domestic demand environment in the medium term.”
The International Monetary Fund said on Oct. 6 that it expected the U.A.E. economy to expand 3.2 percent in 2011, adding that the “health of the corporate sector” remains a challenge. Dubai World, one of the emirate’s three main holding companies, last month said it secured approval from creditors to change the terms on $24.9 billion of debt.
HSBC Bank Middle East to Sell $500 Million of Five-Year Bonds - Bloomberg
HSBC Bank Middle East Ltd. plans to sell $500 million of five-year bonds that may be priced to yield about 175 basis points more than the benchmark mid-swap rate, according to a person with knowledge of the sale.
HSBC Holdings Plc is managing the sale.
HSBC Holdings Plc is managing the sale.
Venezuela, Libya Tout Oil at $100, With OPEC Poised to Keep Quotas Intact - Bloomberg
Venezuela and Libya said oil at $100 a barrel will compensate producers for a slide in the dollar without derailing the global economic recovery.
Crude at $90 to $100 won’t “harm” growth, Venezuelan Energy and Oil Minister Rafael Ramirez said as ministers gathered for the Organization of Petroleum Exporting Countries’ meeting in Vienna at which members are likely to keep production quotas unchanged. Shokri Ghanem, chairman of Libya’s National Oil Corp., also called for higher prices even as other nations said they were content with prices at $70 to $85 a barrel.
“No one will hate oil at $100,” Ghanem said. “The weakening dollar is weakening our income.”
Crude at $90 to $100 won’t “harm” growth, Venezuelan Energy and Oil Minister Rafael Ramirez said as ministers gathered for the Organization of Petroleum Exporting Countries’ meeting in Vienna at which members are likely to keep production quotas unchanged. Shokri Ghanem, chairman of Libya’s National Oil Corp., also called for higher prices even as other nations said they were content with prices at $70 to $85 a barrel.
“No one will hate oil at $100,” Ghanem said. “The weakening dollar is weakening our income.”
Rents for Dubai Tower's Luxury Homes Are Cut on Lack of Tenants - Bloomberg
Rents for luxury apartments in Dubai’s Burj Khalifa, the world’s tallest tower, have been slashed by as much as 40 percent after the owners failed to find tenants, according to a broker that’s marketing the homes.
The cost of renting a studio with floor-to-ceiling windows, marble and wooden floors has dropped to 6,666 dirhams ($1,815) a month, while a one-bedroom apartment is available for 10,000 dirhams, Better Homes said. Two-bedroom homes are going for 15,833 dirhams.
Nine months after Burj Khalifa was inaugurated with a water-and-firework display, about 825 of the tower’s 900 apartments remain unoccupied, said Laura Adams, a residential sales and leasing adviser at Dubai-based Better Homes. The building is within walking distance of The Address, which offers serviced apartments at similar rates.
The cost of renting a studio with floor-to-ceiling windows, marble and wooden floors has dropped to 6,666 dirhams ($1,815) a month, while a one-bedroom apartment is available for 10,000 dirhams, Better Homes said. Two-bedroom homes are going for 15,833 dirhams.
Nine months after Burj Khalifa was inaugurated with a water-and-firework display, about 825 of the tower’s 900 apartments remain unoccupied, said Laura Adams, a residential sales and leasing adviser at Dubai-based Better Homes. The building is within walking distance of The Address, which offers serviced apartments at similar rates.
Dubai-Owned Alliance Medical Said to Get Takeover Interest From BC, CVC - Bloomberg
Alliance Medical Ltd., the U.K.- based medical-imaging company being sold by Dubai International Capital LLC, may attract bids from BC Partners Ltd., CVC Capital Partners Ltd. and Euromedic International, according to two people with knowledge of the matter.
Alliance Medical’s adviser, Blackstone Group LP, have asked that initial offers be made this week, said the people who declined to be identified as the details are private. Hugh Osmond’s Horizon Acquisition Company Plc has also expressed interest in Alliance, another person said.
Blackstone values the company at between 300 million pounds ($475 million) and 340 million pounds, a person familiar with the matter said Aug. 25. Dubai International, a private-equity investor and fund manager owned by Dubai’s ruler, paid about 600 million pounds for Alliance in 2007, the person said.
Alliance Medical’s adviser, Blackstone Group LP, have asked that initial offers be made this week, said the people who declined to be identified as the details are private. Hugh Osmond’s Horizon Acquisition Company Plc has also expressed interest in Alliance, another person said.
Blackstone values the company at between 300 million pounds ($475 million) and 340 million pounds, a person familiar with the matter said Aug. 25. Dubai International, a private-equity investor and fund manager owned by Dubai’s ruler, paid about 600 million pounds for Alliance in 2007, the person said.
Shock 19.8% slump in Singapore Q3 GDP may foretell double dip recession � ArabianMoney
The surprise 19.8 per cent slump in GDP from Singapore in the third quarter indicates a slowdown in global trade that could be the precursor to a double dip recession.
Singapore is the Asian nation most exposed to swings in the global trade cycle as some 50 per cent of GDP is from exports. The 19.8 per cent contraction in Q3 GDP was worse than the 15.7 per cent fall forecast by 19 economists surveyed by Bloomberg.
This kind of downswing in trade is what we saw in Q3 of 2008 before the global financial crisis. But the slowdown in Q3 is all relative. Singapore is still on schedule for 13 to 15 per cent GDP growth in 2010, making the city state the world’s fastest growing economy.
Singapore is the Asian nation most exposed to swings in the global trade cycle as some 50 per cent of GDP is from exports. The 19.8 per cent contraction in Q3 GDP was worse than the 15.7 per cent fall forecast by 19 economists surveyed by Bloomberg.
This kind of downswing in trade is what we saw in Q3 of 2008 before the global financial crisis. But the slowdown in Q3 is all relative. Singapore is still on schedule for 13 to 15 per cent GDP growth in 2010, making the city state the world’s fastest growing economy.
UPDATE 1-Oman's Bank Muscat Q3 profit up 26 pct; beats view | Reuters
Net profit at Bank Muscat BMAO.OM, Oman's largest bank by market value, rose 26 percent in the third quarter, beating analyst's expectations.
The Oman bank posted third-quarter net profit of 25.2 million rials ($65.45 million) compared with 20.01 million rials ($51.97 million) in the same period in 2009, according to Reuters calculations.
The result beat the expectations of analysts polled by Reuters, who estimated an average net profit for the third quarter of 23.18 million rials."
The Oman bank posted third-quarter net profit of 25.2 million rials ($65.45 million) compared with 20.01 million rials ($51.97 million) in the same period in 2009, according to Reuters calculations.
The result beat the expectations of analysts polled by Reuters, who estimated an average net profit for the third quarter of 23.18 million rials."
gulfnews : DP World plans dual listing next year after financial results
Port operator DP World's debt maturities are well-managed and the company does not face any refinancing difficulties, Yuvraj Narayan, the company's chief financial officer said at a conference in Dubai Wednesday.
DP World will seek dual listing in the London stock exchange next year after it publishes its financial results in March, he said yesterday. In June this year, the company had postponed its plans for dual listing.
Speaking at a conference on ‘Treasury, Risk and Finance Professionals' Narayan said, DP World has a debt outstanding of $8 billion (Dh29.3 billion) with most of it having long term maturity. "We target to have more than 85 per cent of our obligations with long term maturity" he said."During the last few years DP World expanded its operations acquisitions and most of the debts on our books came from acquisition financing.
DP World will seek dual listing in the London stock exchange next year after it publishes its financial results in March, he said yesterday. In June this year, the company had postponed its plans for dual listing.
Speaking at a conference on ‘Treasury, Risk and Finance Professionals' Narayan said, DP World has a debt outstanding of $8 billion (Dh29.3 billion) with most of it having long term maturity. "We target to have more than 85 per cent of our obligations with long term maturity" he said."During the last few years DP World expanded its operations acquisitions and most of the debts on our books came from acquisition financing.
Birkett looking for new mountains to climb
The UAE has sent the clearest possible signals that the old days of excessive debt are over. On the day it was announced Aidan Birkett was to step down from his restructuring role at Dubai World - "job done" - Sultan al Suwaidi, the Governor of the UAE Central Bank, highlighted measures to ensure Mr Birkett's skills and the restructuring profession he represents would not be needed again.
Mr al Suwaidi's calls for a more co-ordinated approach to credit management, with control ultimately in the hands of the federal debt management office, should help insure that no single body, in the public or private sector, can amass levels of debt that might threaten the whole economy. These are sensible and realistic proposals, in line with global trends. It does not amount to an "austerity package" along Irish or Greek lines but it should help ensure the UAE manages the recovery properly.
Mr Birkett can leave Dubai with a sense of achievement. It was not all his doing, of course, as he would be the first to admit. The banks with whom he dealt showed a responsible and pragmatic attitude too. For the Dubai Government, which it should be remembered put US$9 billion (Dh33.05bn) of its own money into the restructuring, the Dubai World process was a deeply challenging one, but respond to it it did, as the recent bond prospectus showed.
The challenge for the emirate now will be to finance future growth while staying within the Central Bank's new parameters. Mr Birkett, apparently, is off to climb Mount Kilimanjaro in Africa and will then return to the UAE, perhaps with Deloitte, the accounting firm where he was a partner before Dubai World came along. But there are still debt mountains to be climbed in some parts of the Middle East where his skills would be put to good use.
Mr al Suwaidi's calls for a more co-ordinated approach to credit management, with control ultimately in the hands of the federal debt management office, should help insure that no single body, in the public or private sector, can amass levels of debt that might threaten the whole economy. These are sensible and realistic proposals, in line with global trends. It does not amount to an "austerity package" along Irish or Greek lines but it should help ensure the UAE manages the recovery properly.
Mr Birkett can leave Dubai with a sense of achievement. It was not all his doing, of course, as he would be the first to admit. The banks with whom he dealt showed a responsible and pragmatic attitude too. For the Dubai Government, which it should be remembered put US$9 billion (Dh33.05bn) of its own money into the restructuring, the Dubai World process was a deeply challenging one, but respond to it it did, as the recent bond prospectus showed.
The challenge for the emirate now will be to finance future growth while staying within the Central Bank's new parameters. Mr Birkett, apparently, is off to climb Mount Kilimanjaro in Africa and will then return to the UAE, perhaps with Deloitte, the accounting firm where he was a partner before Dubai World came along. But there are still debt mountains to be climbed in some parts of the Middle East where his skills would be put to good use.
LA airport courts Gulf airlines
As the Gulf's long-haul airlines face growing resistance to expansion into Canadian and European destinations, they are being welcomed with open arms at a major US airport keen to boost passenger traffic. Officials from Los Angeles visited Dubai, Abu Dhabi and Doha this week to assure the big three Gulf long-haul specialists - Emirates Airline, Etihad Airways and Qatar Airways - that they could serve the Southern California gateway airport profitably.
"We think there is a great synergy and a lot of possibility for growth for the Gulf carriers," said Gina Marie Lindsey, the executive director of Los Angeles World Airports. "There is room for all three." In 2008, Emirates opened the first non-stop, direct services between the Middle East and Los Angeles with a service three times a week. Citing heavy demand, the airline soon offered daily services. It is expected to start a twice-daily service within weeks.
The carrier has been working with Boeing to operate its largest capacity 777 aircraft, the 300ER, on the route. This would allow it to fly an additional 75 to 100 passengers on each flight as well as a full load of cargo, compared with the aircraft it currently uses, the 200LR. Los Angeles International Airport officials touted the airport's catchment area of 20 million residents and an investment programme worth US$6.4 billion (Dh23.5bn) including 1 million square feet of new terminal space, opening in 2012.
"We think there is a great synergy and a lot of possibility for growth for the Gulf carriers," said Gina Marie Lindsey, the executive director of Los Angeles World Airports. "There is room for all three." In 2008, Emirates opened the first non-stop, direct services between the Middle East and Los Angeles with a service three times a week. Citing heavy demand, the airline soon offered daily services. It is expected to start a twice-daily service within weeks.
The carrier has been working with Boeing to operate its largest capacity 777 aircraft, the 300ER, on the route. This would allow it to fly an additional 75 to 100 passengers on each flight as well as a full load of cargo, compared with the aircraft it currently uses, the 200LR. Los Angeles International Airport officials touted the airport's catchment area of 20 million residents and an investment programme worth US$6.4 billion (Dh23.5bn) including 1 million square feet of new terminal space, opening in 2012.
UPDATE 1-Dubai's DEWA to issue bonds, Moody's ups outlook | Reuters
State-owned Dubai Electricity and Water Authority [DEWATF.UL] will launch a two-tranche dollar bond, a source at one of the lead managers said, while Moody's on Wednesday raised outlook for the utility.
DEWA's new six- and 10-year bonds are its second issue this year and follow last month's offering of the parent Dubai emirate. Analysts expect solid demand as short-term debt concerns eased and investors favour risky assets globally.
The issues will each be of benchmark size -- at least $500 million -- while lead managers are Citi, Credit Agricole, National Bank of Abu Dhabi, RBS and Standard Chartered, the source said. Pricing will take place on Thursday."
DEWA's new six- and 10-year bonds are its second issue this year and follow last month's offering of the parent Dubai emirate. Analysts expect solid demand as short-term debt concerns eased and investors favour risky assets globally.
The issues will each be of benchmark size -- at least $500 million -- while lead managers are Citi, Credit Agricole, National Bank of Abu Dhabi, RBS and Standard Chartered, the source said. Pricing will take place on Thursday."
Saudi Arabia plans to establish 30 technology incubators | http://www.thenextsiliconvalley.com
Saudi Arabia on Monday announced plans to establish 20 technology incubators by 2015 and 30 incubators by 2025 creating jobs for 20,000 people. The announcement was made at the opening of an international technology incubation conference in Riyadh.
Muhammad Al-Suwaiyel, president of King Abdulaziz City of Science and Technology (KACST), opened the conference aimed at increasing awareness about technology incubators, which are now at the forefront of developing new innovative technologies.
“KACST invests in science and technology and innovation, and innovation is crux of technological and economic development based on knowledge,” the president said, adding that it would help achieve sustained growth for Saudi Arabia.
Muhammad Al-Suwaiyel, president of King Abdulaziz City of Science and Technology (KACST), opened the conference aimed at increasing awareness about technology incubators, which are now at the forefront of developing new innovative technologies.
“KACST invests in science and technology and innovation, and innovation is crux of technological and economic development based on knowledge,” the president said, adding that it would help achieve sustained growth for Saudi Arabia.
Business - Qatar firm eyes hike in Liberty stake - INQUIRER.net
Qatar Telecom QSC is looking at further increasing its stake in listed firm Liberty Telecommunications Holdings Inc., up to the maximum level allowed by Philippine law, the company’s top executive said.
In an interview with reporters Wednesday, QTel chairman Abdul Bin Saud Al-Thani said prospects in the Philippine telecommunications industry were so good that new investments would have to be made, especially on the data side of the business.
Key technologies that QTel was looking at, he said, included further advancements in global system for mobile communications (GSM) technology and next-generation mobile wireless broadband technology long-term evolution (LTE).
In an interview with reporters Wednesday, QTel chairman Abdul Bin Saud Al-Thani said prospects in the Philippine telecommunications industry were so good that new investments would have to be made, especially on the data side of the business.
Key technologies that QTel was looking at, he said, included further advancements in global system for mobile communications (GSM) technology and next-generation mobile wireless broadband technology long-term evolution (LTE).
UPDATE 1-Kuwait telco Zain will not sell Sudan unit - CEO | Reuters
Kuwait telecoms firm Zain (ZAIN.KW), the Gulf's third-largest operator by market value, has no plans to sell its Sudan operations and expects better 2011 results by its Saudi unit, company officials said.
'We consider Sudan to be one of our strategic companies. We have no intention to sell at all,' CEO Nabeel bin Salama told reporters on Wednesday.
He was responding to a question about whether Zain may try to sell its Sudan unit before a planned deal for Emirates Telecommunications Corp ETEL.AD (Etisalat) to buy 46 percent of the Kuwaiti mobile operator."
'We consider Sudan to be one of our strategic companies. We have no intention to sell at all,' CEO Nabeel bin Salama told reporters on Wednesday.
He was responding to a question about whether Zain may try to sell its Sudan unit before a planned deal for Emirates Telecommunications Corp ETEL.AD (Etisalat) to buy 46 percent of the Kuwaiti mobile operator."
Weasel Zippers � Blog Archive � US’s Commerical Aerospace and Defense Trade Mission Meets With UAE For Business Opportunities..
Members of the U.S. Commercial Aerospace ‘&’ Defence Trade Mission – headed by Lieutenant General (Ret.) Lawrence P. Farrell, Jr., President ‘&’ Chief Executive Officer of National Defence Industrial Association – yesterday visited the industrial facilities of Tawazun Holding with the aim to explore potential joint business opportunities.
Tawazun’s Chief executive Officer Saif Mohamed Al Hajeri met with the mission and reviewed with them ways to boost cooperation in knowledge, know-how and technology transfer, as well as exchange of expertise and sharing of best practices.
A presentation session was held with the agenda including an overview of the Offset Policy, Tawazun holding and its subsidiaries; Caracal International, Tawazun Precision Industries, Burkan and Abu Dhabi Autonomous Systems Investments.
Tawazun’s Chief executive Officer Saif Mohamed Al Hajeri met with the mission and reviewed with them ways to boost cooperation in knowledge, know-how and technology transfer, as well as exchange of expertise and sharing of best practices.
A presentation session was held with the agenda including an overview of the Offset Policy, Tawazun holding and its subsidiaries; Caracal International, Tawazun Precision Industries, Burkan and Abu Dhabi Autonomous Systems Investments.
FT.com - Gulf car sales in forward gear
The Arab Gulf car market swiftly came unstuck when the financial crisis washed over the region in late 2008. Fearful banks and wary consumers combined to cause vehicle sales to plunge to unfamiliar lows for the previously ebullient region.
The downturn was readily apparent in the number of unsold cars that piled up at ports around the Gulf, and the deluge of used vehicles that popped up in newspaper and online classified advertisements.
Overall, car sales declined 22 per cent in the Gulf last year, according to estimates by Arabian Automobiles, a leading Dubai-based car dealership owned by the Rostamani family. The wider Middle East fared better, but sales contracted for the first time in at least seven years, by more than 8 per cent to 1m vehicles, according to industry estimates.
However, carmakers and dealerships are now reporting that sales have started to rebound from the lows of last year.
The downturn was readily apparent in the number of unsold cars that piled up at ports around the Gulf, and the deluge of used vehicles that popped up in newspaper and online classified advertisements.
Overall, car sales declined 22 per cent in the Gulf last year, according to estimates by Arabian Automobiles, a leading Dubai-based car dealership owned by the Rostamani family. The wider Middle East fared better, but sales contracted for the first time in at least seven years, by more than 8 per cent to 1m vehicles, according to industry estimates.
However, carmakers and dealerships are now reporting that sales have started to rebound from the lows of last year.
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