The Weekly Circuit
👋 Hello from the Middle East!
Saudi Arabia’s non-oil business has propelled the kingdom to its swiftest job growth in nine years amid its continuing efforts to diversify its economy. October’s Riyad Bank purchasing managers index (PMI), released on Sunday, signaled that private businesses are contributing to growth, which slowed in the third quarter following oil production curbs that were implemented in July.
Saudi Arabia’s decision to constrict supply by 1 million barrels a day, together with Russia’s cut of 300,000 barrels, left the OPEC+ meeting in Vienna last June in disarray, coming on top of production curbs that the 23-member group adopted earlier in the year amid sagging oil prices and reduced demand from China, the world’s second-largest economy.
The UAE’s two-day annual meeting on national policy and goals wrapped up on Wednesday following sessions on artificial intelligence, hosting duties for the U.N.’s COP28 climate conference later this month and progress on the 50-year economic development plan known as Centennial 2071.
Some 500 dignitaries convened at the St. Regis hotel on Saadiyat Island in the largest government gathering of the year. The palm tree-lined beach enclave, connected by a bridge to downtown, is home to the Louvre Abu Dhabi – where works by Leonardo da Vinci and Edouard Manet hang – and the interfaith Abrahamic Family House.
WeWork entered a new chapter in its fall-from-grace saga as the SoftBank-backed firm sought U.S. bankruptcy protection on Monday. The debt-burdened startup that disrupted the multi-trillion dollar office space market sent an email to its 500,000 members overnight, offering reassurances that WeWork’s locations would remain open. It was signed by David Tolley, the CEO brought in last May to lead a turnaround.
With 660 locations in 119 cities worldwide, WeWork has kept a small footprint in the Middle East, opening only in the UAE and Israel, despite some of its biggest backers being from the Gulf. In 2017, Saudi Arabia’s Public Investment Fund and Abu Dhabi’s second largest sovereign fund Mubadala were the majority investors in SoftBank’s $93 billion Vision Fund I, pouring in $45 billion and $15 billion, respectively. Through the Vision Fund, SoftBank became WeWork’s biggest backer and today, it holds about a 60% stake in the embattled company.
But there appear to be no hard feelings between Saudi Arabia and WeWork’s co-founder and former CEO Adam Neumann. The Israeli businessman appeared last month in Riyadh at the kingdom’s Future Investment Initiative — also known as “Davos in the Desert” — where he heard pitches from startup founders in the region and promoted his new real estate venture Flow.
Welcome to The Weekly Circuit. Read on for the stories, deals and players driving the news across the MENA business landscape. Please send comments and story tips to [email protected].
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An accidental grocer has valuable lessons for doing business in the UAE
Jones the Grocer is a UAE institution. Favored by the President, Sheikh Mohammed bin Zayed, it has served breakfast, lunch and dinner to a cast of famous faces, including Hilary Clinton and Tony Blair. With locations now scattered around Abu Dhabi, Dubai, Riyadh and Doha, it began as a rare spot in Abu Dhabi that felt like a neighborhood café, Erica Elkhershi reports for The Circuit.
Goodbye trendiness: Much of the food and beverage industry in the Gulf is dominated by fast-casual franchises in large shopping malls and high-concept restaurants inside five-star hotels. The Jones café-markets are, by contrast, airy, with blue-and-white tile and a pronounced lack of trendiness: upmarket but not designed for Instagram.
Dinner parties: The menu is comfort food-focused: grilled steaks, heaping sandwiches, hearty soups. Large open shelves display gourmet foodstuffs for sale like olive oils, jarred chutneys and marmalades and dark chocolate line the walls. Its charcuterie boards are the mark of a good dinner party in Abu Dhabi; their Thanksgiving turkeys are a favorite of American expats, while the Aussies and Brits lean on Jones to outsource their Christmas roasts. With revenue of over $50 million across all stores, it’s one of the UAE’s local success stories that is about to go global.
Public Investment Fund: Saudi Arabia’s PIF is in talks to invest at least $250 million in China’s Human Horizons Group, a maker of electric vehicles, as part of its efforts to build a domestic auto industry, Bloomberg reports. The fund, which has become a major force in professional golf and soccer, may take a multibillion stake in India’s $30 billion cricket league, according to the news agency.
Mubadala: UAE satellite company Yahsat reported third-quarter profit of $26.4 million, compared to a $10.2 million loss in the same period last year. The Abu Dhabi-listed firm’s nine-month net income more than doubled to $72 million. In September, Yahsat, a subsidiary of Mubadala, was awarded a $5 billion 17-year services mandate by the UAE to provide satellite capacity and services.
ADQ: United Printing & Publishing is set for an IPO on the Abu Dhabi Securities Exchange (ADX) this week after its merger with ADC Acquisition Corp. in the Middle East’s first-ever blank-check merger. The ADQ-backed publisher said its shares will be listed on the ADX exchange starting Nov. 9.
🏡 Russian Reservations: Russian interest in the Dubai property market is starting to wane amid skyrocketing prices and a sinking ruble, Bloomberg reports.
🚕 Flying Taxis: California startup Archer Aviation, which plans to launch electric air taxis in the UAE, will debut its Midnight aircraft at the Dubai Airshow next week.
🚢 Port Operator: Abu Dhabi Ports Group is expected to sign a final agreement with the Egyptian government on its 30-year concession to manage Safaga Port on the Red Sea.
🏖️ Elsewhere Perhaps: S&P Global Ratings agency has raised concerns over the likely impact that the Gaza war will have on tourism in Egypt, Jordan, and Lebanon.
🚆 Laying Tracks: Spanish railway builder Talgo is competing against several French firms on contracts to build a series of high-speed train projects in Morocco.
⛽ China Fuel: QatarEnergy signed a 27-year contract with China’s Sinopec to provide liquified natural gas (LNG) and get help in developing Qatar’s North Field South project.
💊 New Medicine: The UAE’s biggest health-care network, PureHealth, will partner with U.S. tech firm Dell Technologies for generative AI tools to expand services in early disease detection and personalized medicine.
🌞 Renewable Interest: Abu Dhabi energy company Masdar, EDF Renewables and Saudi Arabia’s Nesma Co. will develop a $1 billion solar project in the northwest Al Madinah province in the kingdom.
🖱️ Buying Spree: Palo Alto Networks bought Israeli startup Talon Security for $625 million, a week after spending $315 million on Israel’s Dig Security.
🏭 Smelting Shares: Aluminium Bahrain, the largest smelter of the metal outside China, is considering trading shares on Saudi Arabia’s Tadawul stock exchange.
🔎 Stealth Startup: Myrror Security, an Israeli cybersecurity startup, said it has raised $6 million in seed financing while operating in so-called stealth mode.
⚗️ Merger Ahead: Abu Dhabi National Oil Co. (ADNOC) and Austria’s OMV AG are working on a deal to create a $32 billion petrochemical firm, Bloomberg reports.
🌍 Building Africa: Egypt’s El Sewedy Industrial Development started construction of a factory city in Tanzania that it expects to attract $400 million in investment.
🌳 Green Bond: Abu Dhabi Islamic Bank (ADIB) is set to issue its first dollar-denominated green sukuk, a type of Shariah-compliant bond with proceeds used to finance climate projects.
🎒 Funding EdTech: Saudi Aramco’s VC unit Wa’ed Ventures led a $41 million funding round for Noon, an education platform aimed at Iraq, Egypt and other emerging markets.
🇨🇭 Swiss Air: UAE defense conglomerate EDGE Group acquired a majority stake in ANAVIA, a Switzerland-based company specializing in autonomous aviation for an undisclosed amount.
On the Circuit
Egyptian Prime Minister Mostafa Madbouly met with executives from Siemens, Hutchison, DP Ports and more than a dozen other companies amid plans to hire private businesses to manage the country’s airports.
King Mohammed VI of Morocco delivered a speech on Monday in which he stressed the importance of the $25 billion Morocco-Nigeria gas pipeline project to Africa’s development.
Marc Rowan, CEO of private-equity firm Apollo Global Management, was profiled in the Wall Street Journal after the billionaire philanthropist halted donations to the University of Pennsylvania, stoking the alumni backlash over charges of antisemitism on campus.
Kai Fu-Lee, a computer scientist and member of the board of trustees at Abu Dhabi’s Mohamed Bin Zayed University of Artificial Intelligence, unveiled an open-source, large-language model for his new $1 billion AI venture.
Mohammed Gad was named CEO of Standard Chartered Bank’s new subsidiary in Egypt after serving in the same role in Qatar.
Fahad Abdul Qadar Al Qassim, former head of the healthcare and life sciences investment unit of ADQ, was named chairman of Abu Dhabi-listed Eshraq Investments.
👒 Fashion Slip: Mode Dubai, one of the UAE’s most anticipated fashion events, was postponed from early December to April because of concerns about the Gaza war.
💎 Bling Fling: The UAE’s Watch and Jewellery Middle East Show in the emirate of Sharjah featured a $408,000 gold bicycle and a $2.9 million green diamond ring.
⛳ Night Golf: Bunkered magazine tries to demystify golf in Saudi Arabia, recommending night golfing to avoid the heat and coaching newcomers not to worry about courses that are made more of sand than of grass.
📰 What’s Up: Dubai has a new free weekly newspaper called Sunday. Published by ITP Media Group, it will focus on entertainment, food, fitness and travel.
Ahead on the Circuit
Nov. 13-17, Dubai, UAE: Dubai Airshow. One of the largest gatherings of the aviation and aerospace industries, featuring live aircraft demonstrations. Dubai World Central.
Nov. 14-16, Abu Dhabi, UAE: Global Media Conference. A gathering of international media companies to discuss trends and changes in news delivery. ADNEC.
Nov. 14-18, Sakhir, Bahrain: Jewellery Arabia. Largest annual gathering of sellers and customers in the Middle East. Exhibition World Bahrain.
Nov. 15-16, Riyadh, Saudi Arabia: Misk Global Forum. The biggest youth gathering in the region, hosted by the Mohammed Bin Salman Foundation, this year under the theme “The Big Now” to encourage young people to think ambitiously and act quickly. Bujairi Terrace.
Nov. 17-19, Manama, Bahrain: IISS Manama Dialogue. A forum for government ministers and policymakers, as well as the private sector, to debate the Middle East’s most pressing foreign policy, defense and security challenges. The Ritz-Carlton.
Nov. 22-26, Abu Dhabi, UAE: Abu Dhabi Art. The fair brings together a number of local and international galleries offering artworks for sale which are shown alongside exhibitions, artist commissions and installations both at the fair and across the emirate. Manarat Al Saadiyat.
Nov. 23, Riyadh, Saudi Arabia: Open Banking Conference. A gathering of regional banks and technology firms to further the Saudi Central Bank agenda for its Open Banking Program. Radisson Blu Hotel.
Nov. 27-28, Dubai, UAE: Dubai Future Forum. The forum brings together futurists, foresight practitioners and experts from academia and various industries as well as government to anticipate challenges, share foresight and shape the future. Museum of the Future.
Nov. 27-29, Abu Dhabi, UAE: Fortune Global Forum. A gathering of leaders from the world’s biggest multinational companies discussing the dynamic frontiers of global business. Location to be announced.
Nov. 30-Dec. 12, Dubai, UAE: COP28. United Nations climate change conference opens with speech by King Charles III, drawing government leaders, environmental groups and energy companies from around the world. Expo City.