The Weekly Circuit

👋 Hello from the Middle East! 

This week we’re looking at Saudi Arabia’s effort to navigate the U.S.-China business thicket, Aramco’s $31 billion dividend payout, Aldar’s bankers for a new Islamic bond offering and Riyadh Air’s plans to disrupt the airline industry. But first, doctors and pharma leaders take the stage in Abu Dhabi.

Top minds from medicine and life sciences will convene in the UAE’s capital for Abu Dhabi Global Healthcare Week starting Monday as the country looks to carve a space for itself as a regional hub for cutting-edge research and medical treatment. 

AstraZeneca plans to have a large presence at the conference, with the British-Swedish pharmaceutical and biotechnology company inking a partnership deal with Mubadala-backed healthcare technology company M42 this week. The pair will work to expand cancer diagnostic capabilities in the Middle East. M42 will sequence genes for hereditary breast cancer to develop personalized care tailored to patients. 

Michel Demare, Chair of the Board at AstraZeneca is slated to attend next week’s conference, alongside Iskra Reic, Executive VP of Vaccines; Sameh El Fangary, Head of the GCC; and Pelin Incesu, VP MEA, among other executives. Another in-demand attendee will be Dr. Laurie Glimcher, President and CEO of Boston’s Dana-Farber Cancer Institute. She will be working double-time as a judge at a life sciences startup competition being hosted at Cleveland Clinic Abu Dhabi next week with J.P. Morgan Asset Management.

In Doha, the annual Qatar Economic Forum kicks off on Tuesday with a broad array of Gulf cabinet ministers, central bankers and corporate chiefs taking the stage. Co-branded with Bloomberg – whose editor-in-chief John Mickelthwait and a slew of TV anchors will be conducting onstage interviews – the conference will feature Jenny Johnson, President & CEO of Franklin Templeton, and Ken Griffin, Founder and CEO of Citadel.

Also joining panels in Qatar will be Darren Woods, Chairman and CEO of ExxonMobil; Noor Sweid, Founder and Managing Partner of UAE-based Global Ventures; and Gerry Cardinale, Founder, Managing Partner and Chief Investment Officer of Redbird Capital Partners.

Meanwhile, tech entrepreneurs and venture capitalists starved for funds received a warm invitation at the Milken Institute Global Conference in Beverly Hills to head for the Gulf.

Saudi Arabia’s Minister of Investment Khalid al-Falih led the welcome wagon in a conversation on Tuesday with Dina Powell McCormick, Vice Chairman of BDT & MSD Partners, touting his country as a source for financing in fields from artificial intelligence to sustainable energy.

“Globally leading VCs are flocking to the kingdom,” Al-Falih said, adding: “We’re also attracting global innovators to come to the kingdom to scale up their innovative companies and startups.”

Al-Falih, who also pitched Saudi Arabia’s futuristic Neom project and other mega-developments, didn’t stop at the kingdom’s borders, presenting the six countries of the Gulf Cooperation Council as a safe haven amid conflict across the Middle East.

“I’m not exaggerating when I say Saudi Arabia and the rest of the GCC are actually leading the world and trying to find pragmatic implementable solutions to address the climate challenge and to create opportunities out of the energy transition,” Al-Falih said, pronouncing the Arabian Peninsula “ripe for benefiting foreign investors.” Later in the day, the Minister stopped by a party hosted by Invest Saudi, the kingdom’s foreign investment arm, held on the sidelines of Milken. 

The Ruler of the UAE’s Ras Al Khaimah emirate delivered the opening address at the AIM Conference in Abu Dhabi on Tuesday, describing the country’s investment journey from initial oil wealth to its current role as a key source of capital to countries around the world.

“The UAE has always understood that development can, and should, be reciprocal. I am convinced that by joining forces, we can establish a new investment landscape, with growth that is inclusive, sustainable, and as far as possible, universal,” Sheikh Saud bin Saqr Al Qasimi said to the government ministers, investors and executives gathered. 

The AIM Congress, which goes through Thursday, is an initiative of the AIM Global Foundation that looks to formulate investment strategies and policies and enhance international economic relations in the interest of a globalized economy.

Welcome to The Weekly Circuit. Read on for the stories, deals and players at the top of the news across the MENA business landscape. Please send comments and story tips to [email protected].

AMERICAN DREAM

Alat willing to cut China ties to win U.S. trust, CEO says

Saudi Arabia’s new $100 billion investment fund Alat wants to win the trust of both U.S. tech and government leaders, The Circuit’s Jonathan Ferziger reports.

Special request: Following up on the political terms that paved the way for Microsoft to invest $1.5 billion last month in Abu Dhabi-based artificial intelligence firm G42, Alat CEO Amit Midha says Saudi Arabia is willing to sell its China holdings if asked by Washington. 

Chain reaction: “So far the requests have been to keep manufacturing and supply chains completely separate, but if the partnerships with China would become a problem for the U.S., we will divest,” he told Bloomberg in an interview on the sidelines of the Milken Conference.

Click here to read the full story.

ARAMCO PAYOUT

Saudi Aramco to pay $31 billion dividend as kingdom seeks to plug budget gap

Saudi Aramco, the world’s largest oil company, will distribute $31 billion in dividends despite a decline in first-quarter profit, The Circuit reports.

Mind the gap: The payout is critical to the Saudi government, which owns 82% of the company and has reported a deficit for the sixth straight quarter. The kingdom’s budget gap has forced a slowdown in the pace of building NEOM and other ambitious construction projects.

Bottom line: Aramco reported that first-quarter net income declined 14% to $27.3 billion, down from $31.9 billion a year earlier.

Click here to read the full story.

ADQ: Abu Dhabi’s Etihad Airways has hired BNP Paribas and Morgan Stanley as bookrunners on the $1 billion IPO it’s planning by the end of 2024, Bloomberg reports. ADQ, the sovereign wealth fund that owns Etihad, previously picked Citigroup Inc., HSBC Holdings Plc and First Abu Dhabi Bank as lead advisers for the IPO, according to the news agency. The IPO will create the first publicly traded major Gulf hub carrier as Dubai-based rival Emirates also contemplates going public. Etihad posted a five-fold increase in annual profit last year as it expanded to accommodate post-pandemic demand for international travel.

Public Investment Fund: Lucid, the PIF-backed maker of luxury electric cars, reported a higher than expected first-quarter loss of $0.30 a share. Revenue increased 16% to $173 million from the same period a year ago. The California carmaker’s shares fell over 8% on Monday in after-hours trading. And the PIF will not be the only state-backed entity bankrolling Saudi Arabia’s Vision 2030 economic roadmap. Saudi banks and the capital market are poised to make substantial contributions, according to S&P Global. 

Mubadala: Aldar Properties, the Mubadala-backed Abu Dhabi real estate developer, has hired HSBC and Standard Chartered as global coordinators for its Islamic bond offering of 10-year green sukuk. Meanwhile, Mubadala Investment Co. has announced an investment alongside Global Infrastructure Partners in Perdaman’s $4.2 billion Western Australia Urea project, representing the largest investment ever made in the Australian fertilizer industry. Emirates Global Aluminum, the UAE’s largest industrial company outside the oil and gas sector and backed by Mubadala, has completed the acquisition of Germany’s Leichtmetall Aluminum as it looks to expand its presence in Europe.

International Holding Co.: Aiden Insight, an AI-powered Board Observer, has participated for the first time alongside IHC’s board of directors, the company announced today, where the chatbot broke down the firm’s performance metrics and provided recommendations to boost revenue and profitability.

↪↩ Closing Circuit

⛽ Pumping Gas: The Shell oil company is in talks to sell its chain of gas stations in Malaysia to Saudi Aramco in a deal that could be worth as much as $1 billion, Reuters reports.

🌀 Wind Power: Norway’s Scatec and a group led by Egypt’s Orascom Construction signed agreements to build two wind power plants in Egypt with a combined $9 billion in investment.

📈 Saudi IPO: Rasan, a Saudi fintech firm, said it will sell a 30% stake in an IPO on the Tadawul Stock Exchange, which will open for bookbuilding by institutional investors from May 12-16.

🇲🇦 Aerospace Factory: Swedish aerospace company Trelleborg plans to set up an $11.8 million Moroccan manufacturing unit in the Midparc development near Casablanca.

🔒 Noname Firm: Akamai Technologies said it will buy Israeli cybersecurity startup Noname for $450 million, less than half the company’s value during its last funding round in 2021.

☁️ Cloud Guard: Wiz, an Israeli cloud security company, raised $1 billion in a funding round led by Andreessen Horowitz, Lightspeed and Thrive Capital that values the firm at $12 billion.

🗣 Circuit Chatter

🏗️ City Building: The spiraling costs and construction problems in building Neom, Saudi Arabia’s $500 billion megaproject, are explored in a feature story by the Wall Street Journal.

🏙️ Most Millionaires: Dubai has been ranked as the Middle East’s wealthiest city with 72,500 millionaires, followed by Abu Dhabi with 22,700 millionaires, according to a report by Henley & Partners, which tracks private wealth, and global intelligence provider New World Wealth.

🏍️ Tough Ride: The challenges faced by Turkish delivery app Getir to expand internationally is the subject of a feature story in Bloomberg. 

🏀 Tip Off: Tickets for the 2024 NBA Abu Dhabi Games, which will feature two pre-season games between the Denver Nuggets and Boston Celtics, have gone on sale.

👠 Fashion Lab: The Saudi Fashion Commission announced the launch of “The Lab,” which will provide local designers, brands, and fashion entrepreneurs with state-of-the-art manufacturing facilities.

🌍 Power Circuit

UAE President Sheikh Mohamed bin Zayed sent congratulations to Russian President Vladimir Putin on his inauguration to a fifth term.

Sheikh Maktoum bin Mohammed, First Deputy Ruler of Dubai and President of the Dubai International Financial Centre, met on Tuesday with Yie-Hsin Hung, President and CEO of State Street Global Advisors.

Dr. Sheikh Sultan bin Muhammad Al Qasimi, Ruler of Sharjah, inspected the Al Lyyah Water Canal project, which aims to increase the flow of water from the Arabian Gulf to Sharjah’s Khalid Lake.

Sheikh Shakhbout bin Nahyan, a UAE Minister of State, is heading the country’s delegation to the Islamic Summit of the Organization of Islamic Cooperation, which is taking place this week in Gambia.

Sheikh Mohammed bin Rashid, Ruler of Dubai and Vice President of the UAE, issued a decree establishing the Dubai Council, which he will chair. The body will aim to formulate and implement the emirate’s future development agenda to enhance its global competitiveness. Sheikh Hamdan bin Mohammed, will serve as First Vice Chairman and Sheikh Maktoum bin Mohammed as Second Vice Chairman.

➿ On the Circuit

Sheikh Ahmed bin Saeed Al Maktoum, Chairman and CEO of Emirates, said he’s been assured by Boeing management that the planemaker will sort out the long delays on the 777X widebody, for which the Dubai airline is the biggest customer, Bloomberg reports.

Sarah Al Suhaimi, Chair of the Board of Saudi Tadawul Group, extended an invitation to attendees of the Milken Institute Global Conference to visit the kingdom and the region: “If you’re getting to know us from far away you will be mostly misguided,” she said.

Oscar Fahlgren, Chief Investment Officer and Head of Brazil at Mubadala Capital, spoke about the sovereign wealth fund’s conviction in the future of biofuels on a panel at the Milken Institute Global Conference, days after he disclosed a planned $13.5 billion biofuel project in Brazil.  

Alex Karp, CEO of Palantir, spoke colorfully on an earnings call on Monday after which shares in the spy-tech company dipped as the company cut its growth forecast. 

Seoul Mayor Oh Se-hoon said he hoped to forge stronger economic links with Dubai, speaking at the Dubai Fintech Summit about his city’s role as an Asian financial hub.

Dipak Sakaria, Energy Transition Advisor at the UAE Ministry of Energy & Infrastructure, said Emirates Nuclear Energy Co. is eyeing more reactors to power 4 GW more capacity at its Barakah nuclear power plant, speaking on a panel at NYUAD hosted by AmCham Abu Dhabi on Monday evening, The Circuit reports. 

Aernout Boot, Senior Advisor at The Carlyle Group based in Abu Dhabi, speaking alongside Sakaria, said Carlyle would not join private equity peers in divesting from hydrocarbons amid the energy transition as the U.S. firm sees a long-term role for oil and gas in the global economy. 

Vincent Coste, Chief Commercial Officer of Saudi Arabia’s Riyadh Air, told Arabian Business that the kingdom’s new carrier plans to begin operations quickly and “disrupt the airline industry.”

🎶 Culture Circuit

📽️ Movie Deal: Saudi Arabia is cutting the cost of cinema licenses and encouraging theater owners to reduce ticket prices in an effort to boost the kingdom’s growing $1 billion movie industry.

👻 Arabian Nightmares: An English-language anthology of short horror stories from the region co-created by Lebanese writer Daniel Habib has passed its $10,000 Kickstarter goal, confirming demand for the relatively neglected genre in Arab literature, The National reports.

🎸 Come Around: Punk rock veterans Green Day and The Offspring will perform for 30,000 people at Expo City Dubai in January next year, with tickets going on sale from 10 a.m. on Thursday.

📷 Photo of The Day

🗓️ Circuit Calendar

May 7-9, Abu Dhabi, UAE: AIM Congress. The Annual Investment Meeting will convene inter-governmental leaders, executives, entrepreneurs and policymakers on the theme “Adapting to a Shifting Investment Landscape: Harnessing New Potential for Global Economic Development.” Abu Dhabi National Exhibition Center.

May 13-15, Abu Dhabi, UAE: Abu Dhabi Global Healthcare Week. A conference focusing on investments, and innovation to solve the most important global health challenges. Abu Dhabi National Exhibition Center and Abu Dhabi City.

May 14-15, Abu Dhabi, UAE: J.P. Morgan Asset Management: Life Sciences Innovation Summit. A gathering aimed at drawing startups and investors from the life sciences sector to Abu Dhabi. Cleveland Clinic Abu Dhabi. 

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 invitation here. Fairmont & Raffles, Doha.

May 29-31, Marrakech, Morocco: GITEX Africa. The second edition of the biggest tech and startup gathering in Africa. Place Bab Jdid. 

June 5, Hong Kong: Bloomberg Wealth Event. A gathering to bring actionable intelligence to portfolio managers and other dealmakers and analysts from asset managers and owners, family offices and hedge funds. Conrad Hong Kong. 

June 23-26, National Harbor, Maryland: SelectUSA Investment Summit. The highest profile event in the U.S. to facilitate business investment by connecting thousands of investors, companies, economic development organizations and industry experts to make deals. Gaylord National Resort and Convention Center.