United Arab Emirates

Apollo and Abu Dhabi scratch each other’s backs

2 September 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 June 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 June 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 April 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 March 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 March 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 February 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 February 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 February 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 February 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 January 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 January 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 July 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 July 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 July 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.

Finablr fire sale implies more than dicey markets

14 May 2019

The Travelex owner cut the price of its IPO by 17%, eating into proceeds for its billionaire owner. Had jumpy markets been the only issue, the float could have been delayed. A drastic price cut instead suggests wider investor quibbles with the currency and payments business.

Vision Fund IPO could self-disrupt

3 May 2019

SoftBank may be mulling a float of the $100 bln tech fund. That suggests rich Gulf backers aren’t a shoo-in for a second iteration. While going public would diversify ownership, the entity might trade at a big discount. That would turn off both public and existing investors.

Uber gets an IPO boost from Middle East deal

26 March 2019

The ride-hailing giant will pay $3 bln to acquire Dubai-based rival Careem. It shows the group, which is burning through $1 bln a year, can still spend to grow as it prepares to go public. Amid intense overseas competition, the move gives Uber one less thing to worry about.

SoftBank adds to contradictions with Mubadala punt

18 February 2019

Masayoshi Son’s group is bankrolling half the Abu Dhabi state investor’s $400 mln start-up vehicle. That’s peanuts next to the $100 bln Vision Fund, and gives SoftBank access to early-stage bets. But outsourcing those decisions is an odd look for a supposed tech visionary.

Abu Dhabi’s $6 bln oil deal is a three-way hedge

29 January 2019

The emirate has sold 35 pct of its oil group’s refining arm to two European producers. Italy’s Eni gets to offset a heavy reliance on exploration, while Austria’s OMV gets non-European refining. Abu Dhabi hedges its dependency on crude by turning crown jewels into cash.