Abu Dhabi's Adnoc Finishes Due Diligence on €12 Billion Covestro Deal - Bloomberg
Abu Dhabi National Oil Co. has largely completed due diligence on its planned bid for German chemical company Covestro AG, paving the way for the state-owned energy firm’s biggest-ever deal, people familiar with the matter said.
Adnoc could move forward with an €11.7 billion ($13 billion) offer for Covestro as soon as September, the people said. It has finished site visits to major Covestro plants as part of its in-depth confirmatory due diligence and hasn’t discovered any red flags, according to the people.
The Middle Eastern company still needs final signoff from senior officials for the planned bid of €62 per share, which may take several more weeks, the people said, asking not to be identified because the information is private. Shares of Covestro jumped as much as 5.7% in Frankfurt trading Wednesday to touch €56.90, the highest intraday level since January 2022.
Representatives for Adnoc and Covestro declined to comment.
After more than a year of negotiations, Covestro in June agreed to exchange information with Adnoc to help it firm up the prospective bid. Adnoc said at the time that a potential bid of €62 per share was its final offer, indicating it wouldn’t be raising any further after already bumping several times from its first proposal of €55 per share.
Backed by tens of billions of dollars of oil money, Adnoc has been scouring the world for deals. Chemicals are a big part of that push, as the company sees demand for products used to make goods such as plastics continuing to rise over the coming decades, while the energy transition is likely to slow oil demand.
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Wednesday 28 August 2024
#Qatar in talks on possible purchase of Rosneft stake in German refinery, report says | Reuters
Qatar in talks on possible purchase of Rosneft stake in German refinery, report says | Reuters
Qatar is in talks with the German government over possibly buying Russian energy group Rosneft's (ROSN.MM), opens new tab stake in Germany's PCK Schwedt refinery, which Berlin placed under trusteeship following Russia's invasion of Ukraine, Business Insider news website reported on Wednesday.
Berlin has put Rosneft's German assets under a trusteeship in 2022, still conceding some control to the Russian group over a sale of the assets. A Rosneft lawsuit to challenge Berlin's grasp over the assets failed in court last year. The current trusteeship term is set to expire on Sept. 10.
The German economy ministry told Reuters it would "make a timely decision" on further steps by then.
Relations between Russia and the West collapsed after the full scale invasion of Ukraine in February 2022 and Germany has taken steps to shore up its energy security after concluding it had previously relied too heavily on Moscow.
Rosneft has a 54.17% stake in PCK Schwedt, which has traditionally supplied 90% of the fuel used in Germany's capital, Berlin.
In March, the German government said Rosneft started the sale of its German assets and wants to conclude the process by September.
Russian media has put the valuation of Rosneft's assets in Germany at around $7 billion.
The refinery is also co-owned by Shell (SHEL.L), opens new tab and Eni (ENI.MI), opens new tab. In December, Shell announced the sale of its 37.5% stake in the refinery to Britain's Prax Group.
Qatar Investment Authority and Qatar's international media office did not have an immediate comment.
Rosneft did not immediate reply to a request for comment.
Qatar is in talks with the German government over possibly buying Russian energy group Rosneft's (ROSN.MM), opens new tab stake in Germany's PCK Schwedt refinery, which Berlin placed under trusteeship following Russia's invasion of Ukraine, Business Insider news website reported on Wednesday.
Berlin has put Rosneft's German assets under a trusteeship in 2022, still conceding some control to the Russian group over a sale of the assets. A Rosneft lawsuit to challenge Berlin's grasp over the assets failed in court last year. The current trusteeship term is set to expire on Sept. 10.
The German economy ministry told Reuters it would "make a timely decision" on further steps by then.
Relations between Russia and the West collapsed after the full scale invasion of Ukraine in February 2022 and Germany has taken steps to shore up its energy security after concluding it had previously relied too heavily on Moscow.
Rosneft has a 54.17% stake in PCK Schwedt, which has traditionally supplied 90% of the fuel used in Germany's capital, Berlin.
In March, the German government said Rosneft started the sale of its German assets and wants to conclude the process by September.
Russian media has put the valuation of Rosneft's assets in Germany at around $7 billion.
The refinery is also co-owned by Shell (SHEL.L), opens new tab and Eni (ENI.MI), opens new tab. In December, Shell announced the sale of its 37.5% stake in the refinery to Britain's Prax Group.
Qatar Investment Authority and Qatar's international media office did not have an immediate comment.
Rosneft did not immediate reply to a request for comment.
#Saudi: Tadawul closes Wednesday’s trading session down
Saudi: Tadawul closes Wednesday’s trading session down
The main All Share Index (TASI) of the Saudi Exchange (Tadawul) declined by 0.53% and closed Wednesday’s trading session lower at 12,117.15 points.
The trading value reached SAR 6.85 billion through the exchange of 248.07 million shares.
Red Sea International Company advanced the gainers with 9.90%, while Jabal Omar Development Company headed the decliners with 3.54%.
Besides being the most active stock with 15.56 million shares exchanged, Saudi Arabian Oil Company (Aramco)recorded the highest turnover valued at SAR 431.84 million.
Likewise, the Nomu-Parallel Market Capped Index (NomuC) went down by 0.64% to 26,221.39 points.
Mohammed Hadi Al Rasheed and Partners Company topped the risers with 12.52%, while Naas Petrol Factory Company led the fallers with 26.53%.
The main All Share Index (TASI) of the Saudi Exchange (Tadawul) declined by 0.53% and closed Wednesday’s trading session lower at 12,117.15 points.
The trading value reached SAR 6.85 billion through the exchange of 248.07 million shares.
Red Sea International Company advanced the gainers with 9.90%, while Jabal Omar Development Company headed the decliners with 3.54%.
Besides being the most active stock with 15.56 million shares exchanged, Saudi Arabian Oil Company (Aramco)recorded the highest turnover valued at SAR 431.84 million.
Likewise, the Nomu-Parallel Market Capped Index (NomuC) went down by 0.64% to 26,221.39 points.
Mohammed Hadi Al Rasheed and Partners Company topped the risers with 12.52%, while Naas Petrol Factory Company led the fallers with 26.53%.
#UAE stock markets close Wednesday in red
UAE stock markets close Wednesday in red
The main index of Dubai Financial Market (DFM) lost 19.02 points (0.43%) on Wednesday and ended the trading session at 4,324.20 points.
A total of 297.93 million shares were exchanged during the session at a value of AED 454.67 million.
Emaar Properties recorded the highest turnover of AED 79.48 million, while GFH Financial Group was the most active stock with 64.16 million shares.
Dubai National Insurance and Reinsurance topped the risers with 10%, whereas National International Holding (NIH) headed the decliners with 9.58%.
Likewise, the benchmark index of the Abu Dhabi Securities Exchange (ADX) retreated by 0.483% to 9,288.93 points.
The turnover reached AED 949.58 million through the exchange of 213.43 million shares, while the market cap value hit AED 2.81 trillion.
International Holding Company (IHC) posted the highest turnover of AED 180.41 million, while ADNOC Drilling dominated the trading volume with 23.80 million shares.
Al Dhafra Insurance Company led the risers with 13.70%, whereas RAPCO Investment led the fallers with 3.82%.
The main index of Dubai Financial Market (DFM) lost 19.02 points (0.43%) on Wednesday and ended the trading session at 4,324.20 points.
A total of 297.93 million shares were exchanged during the session at a value of AED 454.67 million.
Emaar Properties recorded the highest turnover of AED 79.48 million, while GFH Financial Group was the most active stock with 64.16 million shares.
Dubai National Insurance and Reinsurance topped the risers with 10%, whereas National International Holding (NIH) headed the decliners with 9.58%.
Likewise, the benchmark index of the Abu Dhabi Securities Exchange (ADX) retreated by 0.483% to 9,288.93 points.
The turnover reached AED 949.58 million through the exchange of 213.43 million shares, while the market cap value hit AED 2.81 trillion.
International Holding Company (IHC) posted the highest turnover of AED 180.41 million, while ADNOC Drilling dominated the trading volume with 23.80 million shares.
Al Dhafra Insurance Company led the risers with 13.70%, whereas RAPCO Investment led the fallers with 3.82%.
#Saudi’s Sovereign Wealth Fund Refinances $15 Billion Loan - Bloomberg
Saudi’s Sovereign Wealth Fund Refinances $15 Billion Loan - Bloomberg
Saudi Arabia’s sovereign wealth fund has signed a $15 billion revolving credit facility with a group of banks, replacing a previous funding agreement it reached in 2021.
The Public Investment Fund, chaired by Crown Prince Mohammed bin Salman, said the loan has a tenor of three years, with an option to extend by up to two more years. The financing will be provided by a group of European, US, Middle East and Asian banks, according to a statement Wednesday.
The PIF, as the fund is known, has spent much of the year hunting for new sources of cash as it looks to push ahead with a massive investment plan intended to help diversify the Saudi economy away from a reliance on oil sales. It’s already tapped bond investors twice this year, raising a total of $7 billion, and it’s also looked to accelerate debt sales and equity offerings in its portfolio companies.
The effort to obtain more cash comes as the fund is aiming to boost annual investment to $70 billion annually from this year, up from $40 billion to $50 billion a year.
Even though the fund plans to ramp up annual spending, executives at alternative investment firms have privately expressed concerns that the PIF will channel more money into local mega-projects, Bloomberg previously reported. That could lead to a pivot away from passive investments in global private equity, infrastructure and hedge funds, people familiar with the matter said.
With the Saudi budget in deficit for much of the last decade, there’s less scope to fund the PIF with transfers of excess oil revenue. As a result, the investor has said it will also rely on asset transfers from the government, retained earnings from its investments, and borrowing.
Earlier this year, the fund received an additional 8% stake in Saudi Aramco - worth more than $160 billion - which PIF Governor Yasir Al Rumayyan also chairs, to help bolster its financial position and credit rating. That helped boost the fund’s assets to almost $1 trillion.
Saudi Arabia’s sovereign wealth fund has signed a $15 billion revolving credit facility with a group of banks, replacing a previous funding agreement it reached in 2021.
The Public Investment Fund, chaired by Crown Prince Mohammed bin Salman, said the loan has a tenor of three years, with an option to extend by up to two more years. The financing will be provided by a group of European, US, Middle East and Asian banks, according to a statement Wednesday.
The PIF, as the fund is known, has spent much of the year hunting for new sources of cash as it looks to push ahead with a massive investment plan intended to help diversify the Saudi economy away from a reliance on oil sales. It’s already tapped bond investors twice this year, raising a total of $7 billion, and it’s also looked to accelerate debt sales and equity offerings in its portfolio companies.
The effort to obtain more cash comes as the fund is aiming to boost annual investment to $70 billion annually from this year, up from $40 billion to $50 billion a year.
Even though the fund plans to ramp up annual spending, executives at alternative investment firms have privately expressed concerns that the PIF will channel more money into local mega-projects, Bloomberg previously reported. That could lead to a pivot away from passive investments in global private equity, infrastructure and hedge funds, people familiar with the matter said.
With the Saudi budget in deficit for much of the last decade, there’s less scope to fund the PIF with transfers of excess oil revenue. As a result, the investor has said it will also rely on asset transfers from the government, retained earnings from its investments, and borrowing.
Earlier this year, the fund received an additional 8% stake in Saudi Aramco - worth more than $160 billion - which PIF Governor Yasir Al Rumayyan also chairs, to help bolster its financial position and credit rating. That helped boost the fund’s assets to almost $1 trillion.
#Saudi PIF Is Among Investors Who Lost Money on Pluralsight Deal - Bloomberg
Saudi PIF Is Among Investors Who Lost Money on Pluralsight Deal - Bloomberg
Saudi Arabia’s sovereign wealth fund is one of the co-investors that lost money on Vista Equity Partners’ acquisition of Pluralsight Inc., according to people with knowledge of the matter.
A handful of Vista’s big clients — including the Public Investment Fund — directly joined the acquisition and contributed equity, the people said, asking not to be named discussing a private transaction. The exact size of PIF’s loss could not immediately be determined.
Vista acquired the educational-software company in 2021 and lost about $4 billion on the transaction along with its co-investors following a debt restructuring that wrapped up last week, Bloomberg News has reported.
The PIF didn’t respond to a request for comment. Vista and Pluralsight declined to comment.
The wipeout has created a painful situation for the limited partners that acquired the company directly with Vista. AustralianSuper, the country’s largest pension, is writing off A$1.1 billion ($750 million) on Pluralsight.
Typically, sovereign wealth funds, pensions and other large money managers diversify their exposure by investing in a private equity fund, which then buys a group of companies. But co-investing, when the money managers invest directly in an individual company alongside a private equity firm, provides a way to cut back on fees and put large sums to work quickly.
Gulf sovereign funds have increasingly been looking to get co-investment rights on deals as they seek better returns and want to boost their reputations as world-class asset managers. But if such investments sour, it leaves the limited partners — alongside the private equity firms — open to losses.
By late 2023, Pluralsight had started to stumble under pressure because of higher interest rates, increased competition and softening demand for its services, Bloomberg reported. Negotiations with the firm’s debt holders led Vista to give up the keys to the company to a group of private credit lenders led by Blue Owl Capital Inc.
Saudi Arabia’s sovereign wealth fund is one of the co-investors that lost money on Vista Equity Partners’ acquisition of Pluralsight Inc., according to people with knowledge of the matter.
A handful of Vista’s big clients — including the Public Investment Fund — directly joined the acquisition and contributed equity, the people said, asking not to be named discussing a private transaction. The exact size of PIF’s loss could not immediately be determined.
Vista acquired the educational-software company in 2021 and lost about $4 billion on the transaction along with its co-investors following a debt restructuring that wrapped up last week, Bloomberg News has reported.
The PIF didn’t respond to a request for comment. Vista and Pluralsight declined to comment.
The wipeout has created a painful situation for the limited partners that acquired the company directly with Vista. AustralianSuper, the country’s largest pension, is writing off A$1.1 billion ($750 million) on Pluralsight.
Typically, sovereign wealth funds, pensions and other large money managers diversify their exposure by investing in a private equity fund, which then buys a group of companies. But co-investing, when the money managers invest directly in an individual company alongside a private equity firm, provides a way to cut back on fees and put large sums to work quickly.
Gulf sovereign funds have increasingly been looking to get co-investment rights on deals as they seek better returns and want to boost their reputations as world-class asset managers. But if such investments sour, it leaves the limited partners — alongside the private equity firms — open to losses.
By late 2023, Pluralsight had started to stumble under pressure because of higher interest rates, increased competition and softening demand for its services, Bloomberg reported. Negotiations with the firm’s debt holders led Vista to give up the keys to the company to a group of private credit lenders led by Blue Owl Capital Inc.
#Saudi’s 2024 inflation forecast revised down to 1.7%
Saudi’s 2024 inflation forecast revised down to 1.7%
Saudi Arabia’s inflation this year is expected to be lower than previously anticipated, as the non-oil growth momentum continues.
In its latest report, Jadwa Investment said it has lowered its inflation forecast for full year 2024 to 1.7%, versus 2% previously.
“We still expect higher inflation rates in H2 than in H1. However, we expect this rise to be lower than we previously anticipated,” the report said.
Saudi’s consumer price growth reached 1.6% in the first half of 2024, with housing costs a major driving factor.
During the second half of the year, Jadwa anticipates prices in food and beverages to see a gradual rebound, in line with global trends.
There will also be marginal pressure from shipping prices, although the rental sector is expected to remain tight for the rest of the year, given the high interest rate environment and influx of expatriates, according to Jadwa.
However, if interest rates do fall before the end of the year, rental demand in the kingdom could ease, as lower rates are likely to drive Saudi nationals back to the mortgage market.
Overall, the rental market in Saudi will still remain strong due to “solid non-oil growth”.
Other non-oil sectors in Saudi Arabia, such as transport, hotels and services in general are also likely to see an increase in demand for the rest of the year.
Saudi Arabia’s inflation this year is expected to be lower than previously anticipated, as the non-oil growth momentum continues.
In its latest report, Jadwa Investment said it has lowered its inflation forecast for full year 2024 to 1.7%, versus 2% previously.
“We still expect higher inflation rates in H2 than in H1. However, we expect this rise to be lower than we previously anticipated,” the report said.
Saudi’s consumer price growth reached 1.6% in the first half of 2024, with housing costs a major driving factor.
During the second half of the year, Jadwa anticipates prices in food and beverages to see a gradual rebound, in line with global trends.
There will also be marginal pressure from shipping prices, although the rental sector is expected to remain tight for the rest of the year, given the high interest rate environment and influx of expatriates, according to Jadwa.
However, if interest rates do fall before the end of the year, rental demand in the kingdom could ease, as lower rates are likely to drive Saudi nationals back to the mortgage market.
Overall, the rental market in Saudi will still remain strong due to “solid non-oil growth”.
Other non-oil sectors in Saudi Arabia, such as transport, hotels and services in general are also likely to see an increase in demand for the rest of the year.
Salik revises revenue growth up to 7-8% following launch of two new toll gates
Salik revises revenue growth up to 7-8% following launch of two new toll gates
Dubai-listed road toll operator Salik expects its revenue to grow 7-8% in 2024 following the launch of two new toll gates valued at AED 2.734 billion ($646 million) in November.
Salik revised its revenue growth upwards from 4-6% with EBITDA margin of 67-68% expected, revised upwards from 65-66%.
The two new gates, Business Bay and Al Safa South, are expected to be operational by the end of November and are designed to enhance traffic flow and reduce congestion in alignment with Roads and Transport Authority (RTA) strategy, Salik said in a filing to Dubai Financial Market (DFM).
Once they are operational, the number of gates operated by Salik will rise from eight to 10.
The Business Bay gate, which accounts for AED 2.265 billion of the valuation, will be the first Salik gate on Al Khail Road rather than the main arterial road passing through Dubai, will be located at Business Bay crossing.
The Al Safa South Gate, which will account for AED 469 million, will be on Sheikh Zayed Road between Al Meydan Street and Umm Al Sheif Street.
Under its concession agreement with the RTA, Salik has the exclusive rights to construct, operate, and maintain the toll gates until end of June 2071.
Salik CEO Ibrahim Sultan Al Haddad said an agreement has been reached with the RTA on a repayment plan for the two new gates over a period of six years, starting from the end of November 2024, with an annual instalment of AED 455.7 million in two equal instalments.
Dubai-listed road toll operator Salik expects its revenue to grow 7-8% in 2024 following the launch of two new toll gates valued at AED 2.734 billion ($646 million) in November.
Salik revised its revenue growth upwards from 4-6% with EBITDA margin of 67-68% expected, revised upwards from 65-66%.
The two new gates, Business Bay and Al Safa South, are expected to be operational by the end of November and are designed to enhance traffic flow and reduce congestion in alignment with Roads and Transport Authority (RTA) strategy, Salik said in a filing to Dubai Financial Market (DFM).
Once they are operational, the number of gates operated by Salik will rise from eight to 10.
The Business Bay gate, which accounts for AED 2.265 billion of the valuation, will be the first Salik gate on Al Khail Road rather than the main arterial road passing through Dubai, will be located at Business Bay crossing.
The Al Safa South Gate, which will account for AED 469 million, will be on Sheikh Zayed Road between Al Meydan Street and Umm Al Sheif Street.
Under its concession agreement with the RTA, Salik has the exclusive rights to construct, operate, and maintain the toll gates until end of June 2071.
Salik CEO Ibrahim Sultan Al Haddad said an agreement has been reached with the RTA on a repayment plan for the two new gates over a period of six years, starting from the end of November 2024, with an annual instalment of AED 455.7 million in two equal instalments.