The Daily Circuit
đź‘‹ Hello from the Middle East!
Today in The Daily Circuit, we’re looking at new incentives for mineral exploration in Saudi Arabia, Mubadala’s $1 billion Islamic bond sale, Chinese loans for Dubai Aerospace and U.S. Secretary of State Antony Blinken’s touchdown in Jeddah. But first, the latest chapter in the Gulf’s sell-off of state assets.
As of this morning, Dubai has IPO’d six out of the 10 government entities it plans to take private as the emirate looks to boost trading volumes on its stock exchange and join the capital markets action picking up speed in Abu Dhabi and Riyadh.
The Dubai public parking company, Parkin, debuted on the DFM today with a 31% surge in its stock price. Parkin’s $429 million IPO was 165 times covered and attracted $71 billion in orders – a record for Dubai. The company pitched to shareholders a growth story on the back of Dubai’s population boom: it forecasts demand for public parking to grow by 60% by 2033, Bloomberg reports.
Strong post-listing performance is becoming a signature of the region’s companies – returning an average of 40% to investors – and spurring international interest in IPOs here. Strong investor demand has been bolstered by government reforms, particularly in the UAE and Saudi Arabia, amid a privatization push.
Nearly 30 IPOs are expected in the Gulf this year. Two of the region’s biggest grocers are in line: Lulu Group is reportedly eyeing a $1 billion dual listing in Abu Dhabi and Riyadh. Spinneys Dubai, the franchisee of the supermarket chain in the UAE and Oman, is also expected to go public in 2024. No word yet on what the Dubai government may sell off next.
đź“° Developing Stories
DIGGING DEEP
As Saudi Arabia seeks to wean its economy off dependence on oil, the kingdom has rolled out a $182 million package of grants aimed at encouraging mining companies to explore for new mineral resources. The incentive program was announced on Wednesday by the Ministry of Industry and Mineral Resources and the Ministry of Investment. Close to 50 minerals have been identified in the kingdom, including marble, granite, gold, copper, aluminum and iron. Saudi Arabia has an estimated mineral wealth of $2.5 trillion and is seeking to attract nearly $200 billion in investments in the mining sector by 2030.
AFRICA OPTIMISTS
The UAE is on track to become the biggest source of foreign investment in Africa over the next five years, surpassing China and France, Bloomberg reports. The UAE pledged $52.8 billion in foreign direct investment in 2022, which exceeds Beijing’s contributions by 20 times and those of the U.S. by seven, according to data from fDi Markets. That figure fell to $44.5 billion in 2023 — still nearly twice that of China, which came in second. Investments are in renewable energy, logistics, technology, real estate and agriculture.
đź’˛ Sovereign Circuit
Mubadala: The Abu Dhabi sovereign wealth fund is seeking to raise about $1 billion in its first dollar-denominated Islamic bond sale.
ADQ: The Abu Dhabi sovereign wealth fund made a joint bid with Spain’s Atitlan fund for the acquisition of Spanish-Greek fish farm operator Avramar, the Athens-based Kathimerini newspaper reports.
Public Investment Fund: PIF Governor Yasir Al-Rumayyan reportedly met with a group of PGA Tour players at Tiger Woods’ property in the Bahamas amid ongoing negotiations over a potential merger with the PIF-backed LIV Golf. “The conversation throughout was constructive and represents an important part of our due diligence process in selecting potential investors,” Tour Commissioner Jay Monahan said in a note to players about the meeting.
đź—Ł Circuit Chatter
🤖 AI Rivals: The UAE and Canada are in an escalating competition to persuade AI startups from Europe and the U.K. to set up headquarters in their countries, the Financial Times reports.
🤝 Trade Pact: The UAE is trying to start independent talks on a trade agreement with the European Union as negotiations have stalled for an EU pact with the full GCC, Reuters reports.
⚱️ Metal Market: Jeddah is set to become a significant hub for copper and zinc metals as the London Metal Exchange plans to establish a new warehouse in the city.
🌿 Green Community: Dubai’s 600-home Sustainable City has become a popular residential community, with its 11 bio-domes and an urban farm at its center, but it hasn’t succeeded in serving as a model for other environmentally-focused developments, Bloomberg reports.
đź’° VC Slide: Venture capital investments in Qatar fell by 57% to $11.8 million last year, more than doubling the 23% decline across the Middle East and Africa, according to a survey by Qatar Development Bank and MAGNiTT.
📰 Extra Extra: Jeff Zucker and media holding company RedBirdIMI are down but they may not be out in the deal to buy the U.K.’s Telegraph, as the group stands to turn a profit in the case it is forced to re-sell, Puck reports.
↪↩ Closing Circuit
đź’° Industrial-Grade: Bahrain-based asset manager Investcorp has teamed up with two unnamed sovereign wealth funds to form a $526 million fund that will invest in industrial real estate in the U.S.
♯ New Tune: Shares of Abu Dhabi-based streaming company Anghami soared 59% on Wednesday after a U.S. regulatory filing showed Saudi-based media company MBC Group has taken a 13.7% stake in the company.
⚒️ Crypto Platform: Mantra, a trading platform for cryptocurrency and tokenized assets based in Dubai and Hong Kong, raised $11 million in a funding round led by Shorooq Partners.
đź’Ą Missile Sale: The U.S. State Department has approved the $260 million sale to Morocco of 612 Javelin missiles and 200 launching units.
🇨🇳 Chinese Loans: Dubai Aerospace said it signed an agreement for a $420 million 5-year unsecured term loan with China Construction Bank for its future financing needs.
🔌 Clean Energy: The UAE’s Masdar sustainable energy company is among the likely bidders for a majority stake in India’s state-owned Ayana Renewable Power, the Economic Times reports.
đź”’ Cyber IPO: Cato Networks, an Israeli cybersecurity firm that was valued last year at more than $3 billion, has hired Goldman Sachs, JP Morgan Chase and Barclays as underwriters for an IPO in New York that aims to raise at least $500 million, Reuters reports. Israeli cyber startup BigID, meanwhile, raised $60 million in a funding round led by Riverwood Capital.
⛵ Budget Boats: Wind Rises, a Dubai-based sailing club committed to making sailing more affordable, raised $1 million in a pre-seed funding round from angel investors.
🌍 Power Circuit
U.S. Secretary of State Antony Blinken met yesterday with Saudi Crown Prince Mohammed bin Salman and Foreign Minister Prince Faisal bin Farhan in Jeddah to discuss the war in Gaza.
King Salman of Saudi Arabia presided over a Cabinet session on Tuesday that clears the way for the International Monetary Fund to set up a regional headquarters in Riyadh.
UAE President Sheikh Mohamed bin Zayed spoke by telephone on Wednesday with Russian President Vladimir Putin to congratulate him on his re-election.
âžż On the Circuit
Noura Al Kaabi, Minister of State at the UAE Ministry of Foreign Affairs, was awarded France’s LĂ©gion d’honneur medal, which carries the rank of Knight, by President Emmanuel Macron, “in appreciation of her efforts to enhance cooperation between the two countries.”
Mustafa Suleyman, the Syrian-British co-founder of DeepMind and Inflection AI, was hired by Microsoft to run its consumer artificial intelligence division. His co-founder Karén Simonyan will also join as Chief Scientist, as well as others from the Inflection team.
Sheikh Nawaf Al Sabah, CEO of Kuwait Petroleum, spoke at CERAWeek in Houston, Texas, on Tuesday about the company’s plans to increase its oil production capacity to 4 million bpd by 2035 from its current 3 million bpd, saying “we see demand increasing throughout this energy transition.”
Faisal Al Bannai, Director General of the Abu Dhabi-backed Advanced Technology Research Council, makes a case for workers in artificial intelligence to think about moving to the UAE in a new feature story in Time magazine.
🎶 Culture Circuit
🙂 Bright Spot: Kuwait has been recognised in a UN-sponsored index as the happiest country in the Gulf region and 13th happiest place globally – its first entry into the top 20 happiest countries on Earth, up from 50th last year. Out of the Gulf countries, the UAE was ranked second, followed by Saudi Arabia and Bahrain. Finland topped the rankings; Afghanistan came in last.
đź“· Photo of The Day
đź“… Circuit Calendar
Apr. 16-17, Abu Dhabi, UAE. Green Hydrogen Summit 2024. Bringing together experts, policymakers, and industry leaders to explore opportunities and the industry’s future. Abu Dhabi National Exhibition Center.
Apr. 16-18, Abu Dhabi, UAE: World Future Energy Summit 2024. A platform to showcase the solutions to some of the most critical challenges identified at COP28. Abu Dhabi National Exhibition Center.
Apr. 16-18, Dubai, UAE. Middle East Energy. Energy leaders gather to debate and shape the future. Dubai World Trade Center.
Apr. 23-25, Dubai, UAE: GISEC Global. A forum for furthering the key discussions that are helping to define cyber resilience and connecting the global cybersecurity community. Dubai World Trade Center.
Apr. 29-May 1, Riyadh, Saudi Arabia: Future Hospitality Summit. An international gathering hosted in cities around the world bringing together the most influential hospitality investors and developers. Mandarin Oriental Al Faisaliah.
Apr. 29 – May 5, Abu Dhabi, UAE: Abu Dhabi International Book Fair. A key event for the publishing industry in the Middle East and North Africa. Abu Dhabi National Exhibition Center.
Apr. 30-May 1, Abu Dhabi, UAE: Mobility Live. A conference and exhibition sponsored by the Abu Dhabi transport regulators, gathering disruptive technology developers in transportation and the public sector. Abu Dhabi National Exhibition Center.
Apr. 30-May 1, Abu Dhabi, UAE: Middle East Rail. The leading conference in the region for rail innovation, technology and strategy. Abu Dhabi National Exhibition Center.
May. 14-16, Doha, Qatar: Qatar Economic Forum, Powered by Bloomberg. A news-driven event dedicated to global business and investment. This year’s theme is ‘A World Remade: Navigating the Year of Uncertainty.’ Request your invite here. Fairmont & Raffles, Doha.