United Arab Emirates

UAE oil IPO looks safer than Saudi for foreigners

6 Sep 2021

Two years after largely spurning Aramco’s listing, international investors have another chance to buy into a Gulf national oil group. At a potential $11 bln, ADNOC’s drilling arm is smaller and in a less tricky locale. A successful sale would confirm the UAE’s overseas appeal.

OPEC spats are less important than its sweet spot

6 Jul 2021

The UAE stymied a deal to unwind oil output cuts. That will further strain relations with Saudi Arabia, but Riyadh will probably find a compromise. Meanwhile, the cartel and its allies have unusual scope to keep crude prices high without losing market share to U.S. producers.

UAE takes relaxed view of Deripaska sanctions risk

24 Jun 2021

Mubadala has bought 2.6% of En+ from the Russian oligarch’s ex-wife. The $243 bln Abu Dhabi fund is banking on the green strategy of the aluminium and energy group, which has taken steps to curb Oleg Deripaska’s influence. Still, the UAE is taking a punt that these controls work.

Saudi gets a partial brand detox with Qatar thaw

6 Jan 2021

Ending Riyadh’s three-year embargo with Doha gives both states a minor economic boost. It also removes one of U.S. President-elect Joe Biden’s Saudi-related headaches. But its main benefit could be to reduce the extent to which foreign investors see the kingdom as kryptonite.

Louis Dreyfus’ Gulf deal makes future less fraught

11 Nov 2020

The commodities trader has sold a 45% stake to Abu Dhabi. An $800 mln-plus inflow will ease the group’s debt burden and fund a shift into more lucrative areas. The broader shareholder base should also end a phase of owner Margarita Louis-Dreyfus paying herself bumper dividends.

Apollo and Abu Dhabi scratch each other’s backs

2 Sep 2020

A consortium led by the private equity titan has struck a $2.7 billion deal for a 49% stake in a real estate company held by the emirate’s energy group ADNOC. Apollo-linked insurers snap up long-term secure assets. Abu Dhabi gets a cash injection from selling the family silver.

Virus inflates allure of Abu Dhabi gas pipelines

23 Jun 2020

The emirate’s oil giant ADNOC has sold 49% of its infrastructure arm to investors including GIC and Brookfield. A $21 bln valuation is higher than mooted before Covid-19. That’s probably because the virus has made a combination of secure assets and leverage even more appealing.

Sovereign funds are having their rainy-day moment

23 Jun 2020

Temasek is stepping in to support Singapore Airlines and a marine group. It makes sense to shore up strategic assets at home when global valuations are high and cash is on hand. Peers from Abu Dhabi’s Mubadala to Malaysia’s Khazanah are likely to follow.

Dubai bailout would spark a complex quid-pro-quo

7 Apr 2020

With a hefty debt pile and an economy disproportionately hit by Covid-19, a repeat of the emirate’s 2009 rescue by neighbour Abu Dhabi is possible. Back then, Dubai renamed its tallest building in return for support. This time, help might have fewer strings attached.

Corona Capital: Cirque du Soleil, Airlines, France

27 Mar 2020

Concise views on the pandemic’s corporate and financial fallout: Cirque du Soleil may leave TPG sunburnt. Airlines get a sweet bailout. And France joins the campaign against dividends.

Cheap gas drives auto industry to distraction

19 Mar 2020

With crude oil futures near $26 a barrel, drivers might lose enthusiasm for electric vehicles if governments put support on hold and let pump prices free-fall. But the push away from hydrocarbons is about more than petrol costs. Carmakers are ill-advised to let investment slide.

NMC mess implies London needs fiercer watchdogs

27 Feb 2020

The Gulf hospital operator fired its CEO after revealing undisclosed debts. Its poor governance and disclosure sit awkwardly with the UK’s aim to be the world’s top venue for foreign companies and capital. Keeping that reputation requires tougher penalties for bad behaviour.

Supply chain “tiger traps” demand better signposts

27 Feb 2020

The centuries-old business of lending to companies’ suppliers has become a 2.8 trln euro playground for financial and technological innovation. Tools that help firms to better use capital can flatter debt levels and exacerbate a liquidity crunch. Investors need more transparency.

DP World U-turn has strings attached for Dubai

17 Feb 2020

The ports and logistics group is buying back a listed stake at a hefty discount. There’s a rationale for doing so, but it will push up leverage. At a time when the emirate is battling a property slowdown, it will also raise the eyebrows of investors who see it as a capital hub.

KKR can profit from Gulf hospital emergency case

10 Feb 2020

Buyout funds including the U.S. group are eyeing the $1.9 bln NMC Health. Its value has sunk amid attacks by short-seller Muddy Waters, poor disclosure and forced sales by large shareholders. It’s a risky move, but the depressed share price offers any buyer a healthy cushion.

Finablr faces tricky reboot after Travelex hack

14 Jan 2020

Shares in the London-listed fintech group have fallen 23% after a cyberattack on its bureau de change unit. The $350 mln decline probably overstates the immediate damage. The bigger risk is whether the mess deters corporate clients from Finablr’s faster-growing payments business.

Fire sale further weakens NMC’s defence

8 Jan 2020

The $3 billion hospital operator fell 15% after big shareholders dumped its stock. The sale, which follows attacks by short seller Muddy Waters, was needed to repay debt. But it highlights the reluctance of the Gulf group’s backers and management to support its depressed shares.

Abu Dhabi’s private equity plunge is sensible idea

15 Jul 2019

Hiking direct investments to the asset class by the emirate’s $700 bln sovereign wealth fund - and cutting reliance on fee-hungry buyout firms - raises risks when the economic cycle turns. But ADIA’s status as one of the more measured SWF dealmakers affords a degree of comfort.

Branson’s space deal defies financial gravity

9 Jul 2019

The bearded billionaire is selling half his cosmic travel group to former Facebook executive Chamath Palihapitiya’s blank-check vehicle. A $1.5 bln valuation looks rich given Virgin Galactic’s record of two test flights. Still, it needs cash, and Palihapitiya has too much of it.

DP World nets decent deal due to tricky IPO waters

1 Jul 2019

The $13 bln Dubai-listed port operator bought energy shipping company Topaz for $1 bln including debt. The buyer has avoided overpaying by sticking to its guns on the price. And Renaissance Services, the majority owner of the target, avoids a risky shot at a public listing.