Builder of Dubai’s Bluewaters Island Cuts 15% of Its Workforce - Bloomberg:
ASGC Group, one of Dubai’s largest builders, cut almost 15% of its workforce as fallout from the coronavirus pandemic takes its toll on the Middle East’s construction industry.
Almost 2,300 employees, including engineers and project managers, were dismissed this month, according to people with direct knowledge of the matter, who asked not to be identified because the matter is sensitive. The company was forced to reduce staff after revenue declined during the second quarter and some projects were delayed or halted, they said.
The contractor has worked on some of the biggest developments in the emirate, including Bluewaters Island, a residential complex with the world’s biggest ferriswheel, and Waldorf Astoria Hotel. In Saudi Arabia, Saudi Binladin Group missed some salary payments in April and May, people famliar with that matter said.
Developers in Dubai such as Emaar Properties PJSC have halted projects and cut salaries as they seek to reduce costs. Lower crude prices and slower economic growth as a result of lockdowns to curb the spread of Covid-19 are aggravating a property slump in Dubai, where oversupply and economic uncertainty have pushed down prices for years.
Thursday 25 June 2020
#Saudi $45 bln bank M&A is haunted by past failure – Breakingviews
Saudi $45 bln bank M&A is haunted by past failure – Breakingviews
Mohammed bin Salman wants a banking champion that’s worthy of his grand visions. Saudi Arabian retail investors may not care much about the crown prince’s dreams. That means National Commercial Bank, the government’s would-be vehicle for building a financial powerhouse, will have to pay up for Samba Financial.
Mohammed bin Salman wants a banking champion that’s worthy of his grand visions. Saudi Arabian retail investors may not care much about the crown prince’s dreams. That means National Commercial Bank, the government’s would-be vehicle for building a financial powerhouse, will have to pay up for Samba Financial.
The two banks on Thursday took the unusual step of announcing that they had arrived at a “framework agreement” for an all-share merger. Odder still, $30 billion NCB set out a range for the deal rather than an agreed price. The country’s largest lender will offer between 0.736 and 0.787 of its own shares for Samba. Using NCB’s undisturbed price, that implies an equity value of between $14.6 billion and $15.6 billion, and a premium of 19% to 27%.
There’s a reason for the unconventional announcement. NCB last year failed in its pursuit of $14 billion Riyad Bank, a deal which was also supposed to create a lender big enough to finance MbS’s megaprojects. Already-tense price negotiations were not helped by the fact that Riyad’s share price kept jumping around. NCB and its advisers may hope that having a range rather than a fixed price gives them more flexibility, for example if the constantly fluctuating oil price radically changes the market values of either group.
More likely, Samba’s minority investors will just expect to get the very top end of the range, since they hold the decisive vote. The Saudi Public Investment Fund, effectively a wing of the state, and other government agencies own roughly two-fifths of Samba. But MbS and co need 75% support to get the deal through. The rest of the shareholder base is dominated by retail investors, who typically pass the shares down through their families and enjoy the dividends. Unlike Samba’s government shareholders, they’re financially motivated.
Oil prices climb as U.S. economic data lends support - Reuters
Oil prices climb as U.S. economic data lends support - Reuters:
Oil prices rose about 2% in a volatile session on Thursday, buoyed by signs of a marginal improvement in the U.S. economy and a tepid rise in fuel demand, but price gains were limited by rising cases of COVID-19 in some U.S. states.
Brent crude rose 74 cents, or 1.8%, to settle at $41.05 a barrel. U.S. West Texas Intermediate (WTI) crude ended the session up 71 cents, or 1.9%, at $38.72.
Road traffic in some of the world’s major cities in June had returned to 2019 levels, data provided to Reuters by location technology company TomTom showed.
Oil prices fell early, then found support as data showed fewer Americans filed for unemployment benefits last week and orders for key capital goods rebounded in May.
Oil prices rose about 2% in a volatile session on Thursday, buoyed by signs of a marginal improvement in the U.S. economy and a tepid rise in fuel demand, but price gains were limited by rising cases of COVID-19 in some U.S. states.
Brent crude rose 74 cents, or 1.8%, to settle at $41.05 a barrel. U.S. West Texas Intermediate (WTI) crude ended the session up 71 cents, or 1.9%, at $38.72.
Road traffic in some of the world’s major cities in June had returned to 2019 levels, data provided to Reuters by location technology company TomTom showed.
Oil prices fell early, then found support as data showed fewer Americans filed for unemployment benefits last week and orders for key capital goods rebounded in May.
#SaudiArabia's biggest lender NCB in merger talks with Samba - Reuters
Saudi Arabia's biggest lender NCB in merger talks with Samba - Reuters:
National Commercial Bank (1180.SE), Saudi Arabia’s biggest lender, said on Thursday it had signed an initial agreement with smaller lender Samba Financial Group (1090.SE) to create a combined entity with almost $214 billion in assets.
NCB’s offer would value each Samba share at 27.42 to 29.32 riyals ($7.82), giving it a maximum market value of $15.63 billion, 27.5% above its market value of nearly $12.3 billion based on Wednesday’s closing price.
Low oil prices and weak economic growth are pushing bank consolidation across the Gulf and if completed the merger would create one of the region’s largest lenders by assets, ranking third after Qatar National Bank (QNB) and UAE’s First Abu Dhabi Bank (FAB.AD).
In a bourse filing, NCB said it had signed a framework agreement for a potential merger with Samba, confirming an earlier Reuters story on the merger talks.
National Commercial Bank (1180.SE), Saudi Arabia’s biggest lender, said on Thursday it had signed an initial agreement with smaller lender Samba Financial Group (1090.SE) to create a combined entity with almost $214 billion in assets.
NCB’s offer would value each Samba share at 27.42 to 29.32 riyals ($7.82), giving it a maximum market value of $15.63 billion, 27.5% above its market value of nearly $12.3 billion based on Wednesday’s closing price.
Low oil prices and weak economic growth are pushing bank consolidation across the Gulf and if completed the merger would create one of the region’s largest lenders by assets, ranking third after Qatar National Bank (QNB) and UAE’s First Abu Dhabi Bank (FAB.AD).
In a bourse filing, NCB said it had signed a framework agreement for a potential merger with Samba, confirming an earlier Reuters story on the merger talks.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar close
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
#AbuDhabi based KKBO said set to hire PwC, Trussbridge to restructure debt - Arabianbusiness
Abu Dhabi-based KKBO said set to hire PwC, Trussbridge to restructure debt - Arabianbusiness:
Abu Dhabi-based KBBO Group, once one of NMC Health Plc’s biggest shareholders, is set to hire PwC and Trussbridge Advisory Ltd. to advise on its debt restructuring, people familiar with the matter said.
KBBO, a privately-held investment firm with assets in healthcare and finance sectors, also plans to appoint a chief restructuring officer in the next few weeks to help coordinate the process, the people said, asking not to be identified because the matter is private.
Creditors to the company have set up separate steering committees for both the healthcare and consumer side of the business and will also appoint advisers, the people said. The reorganization is being supervised by the United Arab Emirates’ Financial Restructuring Committee, people familiar with the matter said in April.
Abu Dhabi-based KBBO Group, once one of NMC Health Plc’s biggest shareholders, is set to hire PwC and Trussbridge Advisory Ltd. to advise on its debt restructuring, people familiar with the matter said.
KBBO, a privately-held investment firm with assets in healthcare and finance sectors, also plans to appoint a chief restructuring officer in the next few weeks to help coordinate the process, the people said, asking not to be identified because the matter is private.
Creditors to the company have set up separate steering committees for both the healthcare and consumer side of the business and will also appoint advisers, the people said. The reorganization is being supervised by the United Arab Emirates’ Financial Restructuring Committee, people familiar with the matter said in April.
#Lebanon paying price for deteriorating Gulf ties, says #UAE official - Reuters
Lebanon paying price for deteriorating Gulf ties, says UAE official - Reuters:
A senior United Arab Emirates official (UAE) said Lebanon was paying the price of deteriorating ties with wealthy Gulf Arab states as it struggles to cope with a deep economic crisis.
Gulf states have long channelled funds into Lebanon’s fragile economy but they are alarmed by the rising influence of Hezbollah, a powerful group backed by their arch-rival Iran, and appear loath to help ease Beirut’s worst financial crisis in decades.
Emirati minister of state for foreign affairs, Anwar Gargash, told broadcaster CNBC on Wednesday that Lebanon’s “economic meltdown is very worrying” but that the UAE would only consider offering financial support in concert with other states.
“If we see some of our friends, major powers interested in Lebanon, working in a plan, we will consider that. But up to now, what we are really seeing here, is a deterioration of Lebanon’s Arab relations and Gulf relations over the past 10 years. Lebanon is partly paying the price for that right now.”
A senior United Arab Emirates official (UAE) said Lebanon was paying the price of deteriorating ties with wealthy Gulf Arab states as it struggles to cope with a deep economic crisis.
Gulf states have long channelled funds into Lebanon’s fragile economy but they are alarmed by the rising influence of Hezbollah, a powerful group backed by their arch-rival Iran, and appear loath to help ease Beirut’s worst financial crisis in decades.
Emirati minister of state for foreign affairs, Anwar Gargash, told broadcaster CNBC on Wednesday that Lebanon’s “economic meltdown is very worrying” but that the UAE would only consider offering financial support in concert with other states.
“If we see some of our friends, major powers interested in Lebanon, working in a plan, we will consider that. But up to now, what we are really seeing here, is a deterioration of Lebanon’s Arab relations and Gulf relations over the past 10 years. Lebanon is partly paying the price for that right now.”
MIDEAST STOCKS-Major Gulf markets retreat in early trade - Agricultural Commodities - Reuters
MIDEAST STOCKS-Major Gulf markets retreat in early trade - Agricultural Commodities - Reuters:
Major Gulf stock markets traded lower on Thursday, with Saudi Arabian shares hit by an International Monetary Fund (IMF) forecast of a deeper than anticipated recession in the country.
Saudi Arabia’s benchmark index dropped 0.8%, with Al Rajhi Bank falling 0.7% and petrochemical company Saudi Basic Industries down 1.5%.
The Saudi economy will shrink by 6.8% this year, the IMF said on Wednesday, a sharper decline than a 2.3% contraction estimated in April, as low oil prices and the coronavirus pandemic hit hard.
Virus containment measures have crippled burgeoning areas of the country’s non-oil economy such as tourism and entertainment, and lower oil prices have hit state revenues.
In Dubai, the index declined 1%, with its largest bank Emirates NBD declining 1.7% and Emaar Properties down 0.7%.
Major Gulf stock markets traded lower on Thursday, with Saudi Arabian shares hit by an International Monetary Fund (IMF) forecast of a deeper than anticipated recession in the country.
Saudi Arabia’s benchmark index dropped 0.8%, with Al Rajhi Bank falling 0.7% and petrochemical company Saudi Basic Industries down 1.5%.
The Saudi economy will shrink by 6.8% this year, the IMF said on Wednesday, a sharper decline than a 2.3% contraction estimated in April, as low oil prices and the coronavirus pandemic hit hard.
Virus containment measures have crippled burgeoning areas of the country’s non-oil economy such as tourism and entertainment, and lower oil prices have hit state revenues.
In Dubai, the index declined 1%, with its largest bank Emirates NBD declining 1.7% and Emaar Properties down 0.7%.
GCC Economies Face Potential Expats Exodus - Bloomberg
GCC Economies Face Potential Expats Exodus - Bloomberg:
Ashraf Abu Issa, chairman of Abu Issa Holding, a Doha-based conglomerate that owns 100 retail stores and employs more than 3,000 people in Qatar and beyond, discusses how the potential exodus of expatriates from the region might affect his businesses. He speaks with Bloomberg's Simone Foxman. (Source: Bloomberg)
Ashraf Abu Issa, chairman of Abu Issa Holding, a Doha-based conglomerate that owns 100 retail stores and employs more than 3,000 people in Qatar and beyond, discusses how the potential exodus of expatriates from the region might affect his businesses. He speaks with Bloomberg's Simone Foxman. (Source: Bloomberg)
#Saudi Banks Facing Triple Jeopardy: Samba Financial CEO - Bloomberg
Saudi Banks Facing Triple Jeopardy: Samba Financial CEO - Bloomberg:
Rania Nashar, chief executive officer of Samba Financial Group, a Riyadh-based lender, talks about the state of the kingdom’s banks and the economy. She also discusses the need to empower women. She speaks with Bloomber's Yousef Gamal El-Din. (Source: Bloomberg)
Rania Nashar, chief executive officer of Samba Financial Group, a Riyadh-based lender, talks about the state of the kingdom’s banks and the economy. She also discusses the need to empower women. She speaks with Bloomber's Yousef Gamal El-Din. (Source: Bloomberg)
#Saudi oil exports down by $12 billion year on year in April - Reuters
Saudi oil exports down by $12 billion year on year in April - Reuters:
The value of Saudi Arabia’s oil exports dropped by 65.4% in April when compared to the same month a year earlier, or a fall of about $12 billion, official data showed on Thursday.
Compared to March, total exports - including non-oil exports of goods such as chemicals and plastics - decreased by 23.5%, or about $3 billion, the General Authority for Statistics said.
Amid a drop in demand and oil prices, in the first quarter the value of Saudi Arabia’s oil exports plunged by 21.9% year on year to $40 billion, corresponding to a decline of about $11 billion, official data showed earlier this month.
The value of Saudi Arabia’s oil exports dropped by 65.4% in April when compared to the same month a year earlier, or a fall of about $12 billion, official data showed on Thursday.
Compared to March, total exports - including non-oil exports of goods such as chemicals and plastics - decreased by 23.5%, or about $3 billion, the General Authority for Statistics said.
Amid a drop in demand and oil prices, in the first quarter the value of Saudi Arabia’s oil exports plunged by 21.9% year on year to $40 billion, corresponding to a decline of about $11 billion, official data showed earlier this month.
#Saudi’s Samba CEO Sees U-Shaped Recovery After ‘Triple Jeopardy’ - Bloomberg
Saudi’s Samba CEO Sees U-Shaped Recovery After ‘Triple Jeopardy’- Bloomberg:
Samba Financial Group expects the kingdom’s economy to have a slow U-shaped recovery after being hit by the “triple jeopardy” of low oil prices, reduced interest rates and the coronavirus pandemic.
Recovery from the coronavirus shutdown is already underway, and “we see a full recovery toward the end of 2021,” Chief Executive Officer Rania Nashar said in an interview with Bloomberg TV on Thursday.
In response to the crisis, Samba booked higher provisions in the first quarter to “build our reserves so we’re ready for any surprises” later in the year, she said. The bank is also reviewing SMEs to see if more stimulus measures are needed from the Saudi regulator.
Samba Financial Group expects the kingdom’s economy to have a slow U-shaped recovery after being hit by the “triple jeopardy” of low oil prices, reduced interest rates and the coronavirus pandemic.
Recovery from the coronavirus shutdown is already underway, and “we see a full recovery toward the end of 2021,” Chief Executive Officer Rania Nashar said in an interview with Bloomberg TV on Thursday.
In response to the crisis, Samba booked higher provisions in the first quarter to “build our reserves so we’re ready for any surprises” later in the year, she said. The bank is also reviewing SMEs to see if more stimulus measures are needed from the Saudi regulator.
European, Middle Eastern & African Stocks - Bloomberg #UAE #SaudiArabia #Qatar mid-session
European, Middle Eastern & African Stocks - Bloomberg:
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Updated stock indexes in Europe, Middle East & Africa. Get an overview of major indexes, current values and stock market data in Europe, UK, Germany, Russia & more.
Oil prices extend losses on U.S. stock build, virus fears - Reuters
Oil prices extend losses on U.S. stock build, virus fears - Reuters:
Oil prices slipped further on Thursday after tumbling more than 5% in the previous session, as a record build in U.S. crude inventories and a rapid resurgence in COVID-19 cases cast doubts on a recovery in fuel demand.
U.S. West Texas Intermediate (WTI) crude futures fell 26 cents, or 0.7%, to $37.75 per barrel at 0640 GMT, after dropping $2.36 on Wednesday.
Brent crude futures fell 31 cents, or 0.8%, to $40.00 per barrel after falling $2.32 on Wednesday. A day earlier, the benchmark contract hit its highest price since early March, just before pandemic lockdowns and a Saudi-Russian price war slammed markets.
“Prices retreated after the EIA data signalled an inventory build much higher than expected,” said Avtar Sandu, senior commodities manager at Singapore-based brokerage Phillip Futures.
Oil prices slipped further on Thursday after tumbling more than 5% in the previous session, as a record build in U.S. crude inventories and a rapid resurgence in COVID-19 cases cast doubts on a recovery in fuel demand.
U.S. West Texas Intermediate (WTI) crude futures fell 26 cents, or 0.7%, to $37.75 per barrel at 0640 GMT, after dropping $2.36 on Wednesday.
Brent crude futures fell 31 cents, or 0.8%, to $40.00 per barrel after falling $2.32 on Wednesday. A day earlier, the benchmark contract hit its highest price since early March, just before pandemic lockdowns and a Saudi-Russian price war slammed markets.
“Prices retreated after the EIA data signalled an inventory build much higher than expected,” said Avtar Sandu, senior commodities manager at Singapore-based brokerage Phillip Futures.