The Weekly Circuit
👋 Hello from the Middle East!
This week we’re looking at Qatar’s investment in European semiconductors, Mubadala’s acquisition of Fortress Investment, Saudi Arabia’s consolidation of entertainment companies owned by the PIF and Arab filmmakers mingling with Meryl Streep at Cannes. But first, airline executives are setting their flight paths for Riyadh.
Leaders in aviation are gathering in Saudi Arabia next week to mull the future of flight as the Gulf enjoys boom times for travel and tourism and billions of dollars are being invested to modernize travel in the region. The three-day Future Aviation Forum gets underway on Monday, May 20, in Riyadh.
Executives from Saudi’s Public Investment Fund portfolio companies will be on hand, including Captain Arnaud Martinez, CEO of The Helicopter Co.; and Edward O’Byrne, CEO of AviLease, as well as heads of regional aviation firms such as Ghaith AlGhaith, CEO of flydubai; Steve Allen, CEO of Emirates-owned dnata; and Saudi budget carrier flynas CEO Bander AlMohanna.
Gulf airlines are expanding their fleets amid the recovery in world travel and tourism and some — like UAE flag carrier Etihad and Saudi’s flynas — are eyeing initial public offerings. Driving growth for the future of Saudi’s aviation industry will be the Red Sea International Airport, catering to the western coast’s luxury tourism industry and the Neom megaproject. Air traffic across the country increased 26% last year, reaching 112 million passengers, according to the Saudi General Authority of Civil Aviation.
Among veteran investors plying the U.S.-Gulf relationship, Anthony Scaramucci is one of the most formidable networkers. The Founder and Co-Managing Partner of SkyBridge Capital, who served briefly as White House spokesman in 2017, Scaramucci hosts his annual SALT-iConnections conference in New York next week.
Headlining the two-day event that also starts on Monday is UAE Economy Minister Abdulla Bin Touq Al Marri. Also taking the stage will be Michael Arougheti, Co-Founder, Chief Executive Officer & President of Ares Management; Sherrese Clarke Soares, Founder and CEO of HarbourView Equity Partners; and retired U.S. Army General Mark Milley, former Chairman of the Joint Chiefs of Staff.
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].
DEREGULATING DOHA
Qatar seeks to ‘liberate’ hotel industry in push for tourists
Qatar’s hosting of the FIFA World Cup soccer tournament ignited tourism in 2022 and officials say they hope to stoke the industry further through deregulation, The Circuit’s Jonathan Ferziger reports.
Letting loose: By changing rules on licensing and operating hours, the Gulf state expects to generate a new bounty of international visitors, Saad bin Ali Al Kharji, Chairman of Qatar Tourism told Bloomberg in an interview.
Unexpected guests: Defying expectations of a downturn following the World Cup, incoming arrivals to Qatar swelled 39% to 4 million tourists last year from 2022. Qatar’s strategic plan calls for tourism to contribute 12% to GDP.
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CHIPPING AWAY
Qatar makes chips play amid Gulf push into AI
Qatar’s Prime Minister Sheikh Mohammed bin Abdulrahman Al-Thani opened the Qatar Economic Forum in Doha on Tuesday morning with the message that the country is continuing its economic diversification efforts driven by its sovereign wealth fund, Qatar Investment Authority (QIA), The Circuit’s Kelsey Warner reports.
Tech pivot: QIA, which has over a half trillion dollars in assets under management, has made the U.S. its main market but it is eyeing emerging markets like Central Asia and Africa, he said, and the fund is accelerating investments in technology.
Smart move: The remarks at the Bloomberg-hosted forum follow an announcement from the QIA on Monday that it plans to be an anchor investor in Ardian Semiconductor, a fund set up by French private equity firm Ardian to invest in the semiconductor industry across Europe.
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💲 Sovereign Circuit
Mubadala: Mubadala Capital completed its acquisition of Fortress Investment Group, a major investor in credit markets with a large allocation in U.S. rail. Terms of the deal were not disclosed, according to a statement on Wednesday by the two companies. Meanwhile, Spanish soccer’s Real Madrid lost a $440 million court battle with Mubadala over the proposed sponsorship of its stadium in Madrid, Reuters reports. The club claimed that the Abu Dhabi sovereign wealth fund failed to honor a sponsorship deal under which it would acquire rights to name the Santiago Bernabeu stadium for 20 years. Instead, the deal expired. In Indonesia, the government will ask Mubadala Energy to speed up gas development in Indonesia’s South Andaman Block after the firm announced a second major discovery there.
Public Investment Fund: The PIF is consolidating Saudi Entertainment Ventures (also known as SEVEN) under Qiddiya Investment Co. to create a single recreation and entertainment entity in the kingdom. SEVEN will remain part of the PIF and continue to deliver on its mandate to develop 21 entertainment projects in 14 cities across Saudi Arabia. Meanwhile, the PIF has invited banks to pitch for roles on the planned initial public offering of the kingdom’s largest medical procurement firm, Nupco, Bloomberg reports. Rothschild & Co. is advising on the potential IPO. Also, 500 Global, the San-Francisco based venture capital firm, and Sanabil, a Saudi financial investment company owned by the PIF, have accepted 12 new startups into their Sanabil 500 MENA Seed Accelerator Program.
Qatar Investment Authority: QIA CEO Mansoor Al Mahmoud agreed with Brookfield Asset Management CEO Bruce Flatt that exploring investment opportunities in China remains compelling even as some other investors pull back from the world’s second-largest economy, speaking on a panel at the Qatar Economic Forum on Tuesday. “We have an allocation for China and we are focused on consumer-related industries,” Al Mahmoud said.
Abu Dhabi Investment Authority: A consortium led by private equity giant Blackstone, along with ADIA and GIC of Singapore, submitted a non-binding bid late last week to acquire a controlling stake in Haldiram Snacks Food, the combined packaged snacks and foods business owned by the Agarwal family of Delhi and Nagpur, The Economic Times reports.
Kuwait Investment Authority and Oman Investment Authority: The two sovereign wealth funds signed a preliminary agreement for joint investments and to enter into discussions about future opportunities in their respective countries. The plan also calls for assessing investments in existing funds affiliated with the OIA in asset classes such as energy, infrastructure, communications, transportation and logistics, as well as the possibility of forming a joint fund.
↪↩ Closing Circuit
💰 Tech Closing: Bahrain-based Investcorp announced the successful closing of its Investcorp Technology Partners fund at $570 million, exceeding its initial target. The fund will focus on software, data analytics, cybersecurity and fintech.
💸 PE Partner: Saudi Venture Capital (SVC) plans to invest $30 million in a private equity fund managed by General Atlantic focused on investing in high-growth, tech-enabled companies. Bill Ford, Chairman and CEO of General Atlantic, called SVC “a highly strategic investor who will deepen our expertise in this important region.”
🛬 IPO-Ready: Emirates Group’s dnata, which provides airport and travel services in over 30 countries, could be ready to go public within six months, Chief Executive Steve Allen told Zawya, calling the Dubai-based company a “great IPO target.” Dnata is also looking at a range of merger and acquisition opportunities, Allen said.
💸 VC Fund: Accel, an Israeli venture capital firm, raised $650 million for a new fund that plans to invest in Israeli and European startups.
🏠 Proptech Exit: Dubai-based Property Finder raised $90 million in debt from California private equity firm Francisco Partners to help finance the buyout and exit of its first investor, Dubai VC fund BECO Capital. Michael Lahyani, Property Finder’s Founder and CEO, told Bloomberg his company is valued at about $1 billion.
🏥 Healthy Debut: The biggest initial public offering in Saudi Arabia this year drew $91 billion worth of orders for Saudi hospital group Dr. Soliman Abdul Kader Fakeeh Hospital. The IPO on the Tadawul exchange was covered 119 times by institutional investors, according to a statement on Tuesday, with the company and founding family set to raise 2.86 billion riyals ($763.4 million) in the listing.
🗣 Circuit Chatter
🏭 Copper Rush: Saudi Arabia, the UAE, Japan and the U.S. are engaged in a global rush — pitted against China — to acquire copper, a key component in electric cars and data centers, the Wall Street Journal reports.
🌞 Renewable Hope: The newly formed government in Kuwait could accelerate economic diversification plans and an ambitious renewable energy target that have been stalled for years by political paralysis, according to analysis by The Arab Gulf States in Washington think tank.
💰 Great Expectations: Gulf sovereign wealth funds have poured money into dozens of U.S. private tech funds with the expectation that some of their cash will funnel back to the region’s startups, The Information reports in a feature story. Now there are signs that VC and private equity funds are responding by scouting for investments in local startups, the story says.
📚 Diplomacy Lessons: The Anwar Gargash Diplomatic Academy and the Ministry of Investment have formed a strategic alliance to advance the UAE’s economic diplomacy.
💵 Gulf Broker: The Biden administration has brokered Silicon Valley’s ties to the Gulf as a bulwark against China, helping spur a generation of tech founders who are making quiet pilgrimages to the region’s sovereign wealth funds, the Washington Post reports.
💰 Big Payday: May paychecks for Emirates Group employees will be a bit fatter as the Dubai airline plans to disperse a 20-week bonus to staff after it posted a record profit for its financial year ending March 31, The National reports.
🩸Healthy Deposits: Mubadala-backed healthcare entity M42 announced a partnership with Abu Dhabi’s Department of Health to launch a Biobank with the region’s largest hybrid cord blood bank during Abu Dhabi Global Healthcare week. The facility will support medical research and delivery of stem cell therapies.
🌍 Power Circuit
UAE President Sheikh Mohamed bin Zayed welcomed a group of health ministers and officials on Tuesday who are participating in Abu Dhabi Global Healthcare Week. Khaled bin Mohamed bin Zayed, Crown Prince of Abu Dhabi and Chairman of Abu Dhabi Executive Council, inaugurated the conference on Monday under the theme ‘Accelerating the Future of Global Healthcare.’
Sheikh Mansoor bin Mohammed, Chairman of Dubai’s Supreme Committee of Crisis and Disaster Management, officially opened the Critical Communications World 2024 conference on Tuesday at the Dubai World Trade Centre.
Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, on Monday approved the second phase of a heritage architecture project aimed at safeguarding 35 of the city’s historic sites from the 1960s to the 1990s.
Sheikh Maktoum bin Mohammed, First Deputy Ruler of Dubai, UAE Deputy Prime Minister and Minister of Finance, and President of the Dubai International Financial Centre, appointed four new members to Dubai Financial Services Authority’s Board on Sunday. The appointments of Robert Ophèle, Andrew Procter, Javan Herberg KC and Sock Koong Chua will reinforce the emirate’s position as a leading financial and business center, Sheikh Maktoum said.
Sheikha Sheikha bint Saif Al Nahyan, the honorary president of the Make-A-Wish Foundation UAE, commended the selection of Abu Dhabi to host Make-A-Wish International’s annual “Global Wish” summit next June. She said the organization “embodies the spirit of compassion, generosity, tolerance, and humanity that distinguishes Abu Dhabi’s character.”
Emir of Kuwait Sheikh Mishal Al-Ahmad Al-Jaber Al-Sabah formed a new cabinet on Sunday headed by Sheikh Ahmad Abdullah Al-Sabah. Emad al al-Atiqi, Anwar Ali al-Mudhaf and Abdullah Ali al-Yahya retained their posts as oil, finance and foreign ministers respectively, according to the decree. Sheikh Ahmad is the emir’s nephew and was previously appointed prime minister in April, Reuters reports.
➿ On the Circuit
Dr. Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Managing Director and Group CEO, held a meeting with U.S. Energy Secretary Jennifer Granholm on Tuesday at ADNOC’s headquarters in Abu Dhabi.
U.K. Deputy Prime Minister Oliver Dowden said some $3.7 billion of investments from Saudi Arabia will provide about 2,000 jobs and boost development in northeastern England, speaking at the GREAT Futures Initiative Conference in Riyadh on Tuesday.
Mohamed Khalifa Al Mubarak, Chairman of Abu Dhabi’s Department of Culture and Tourism, was awarded France’s Legion d’Honneur in a ceremony at the Louvre Abu Dhabi this week.
Sam Altman, CEO of OpenAI, shared that Ilya Sutskever, OpenAI’s Co-Founder and Chief Scientist, would be leaving the company to work on “something personally meaningful” in a post to X on Tuesday. Sutskever will be replaced by Jakub Pachocki, the company’s research director.
Jimmy Dunne, one of the architects behind the PGA Tour’s framework agreement with Saudi Arabia’s Public Investment Fund, has resigned from the PGA Tour policy board effective “immediately,” citing a lack of progress on a potential deal with PIF as one of his reasons.
Haitham Abdulkarim has been hired by U.S. private asset manager Blue Owl Capital Inc. to oversee the company’s institutional business in the Middle East, where he’ll focus on scaling investment and operations teams across Abu Dhabi and Dubai, Bloomberg reports. Abdulkarim was previously Head of UAE at BlackRock.
Cristiano Ronaldo is investing in wearable tech start-up Whoop, as it expands in the Gulf. Announcing the partnership while reclining on a pool lounger, the Portuguese soccer star and Al-Nassr FC player revealed that one of his secrets to a good night’s sleep is never taking phone calls after 10pm.
Michael Wong, Deputy Financial Secretary of Hong Kong, said his office is working with financial institutions in the Gulf on the listing of an ETF in the Middle East to track Hong Kong’s stock indices, among other developments to help Gulf sovereign wealth funds tap opportunities in China, in an interview with Zawya on the sidelines of the Capital Market Forum in Hong Kong last week.
🎶 Culture Circuit
📽️ Lights, Camera, Action: As the Cannes Film Festival returns this week, the growing presence of Arab filmmakers and, in particular, Saudi Arabia’s emerging influence in the movie business is hard to miss. Jomana Al Rashid, CEO of Saudi integrated media group SMRG and Chairwoman of the Red Sea Film Festival, was seen on the red carpet and pictured cozying up with actress Meryl Streep. Meanwhile, Variety reports that Saudi Arabian director Shahad Ameen, known for feminist fable “Scales,” is shooting a new film about female empowerment called “Hijra” across several Saudi cities, including Jeddah, Medina, AlUla and Neom.
🍺 Local brew: The first licensed microbrewery in the Gulf is busily fermenting beer in Abu Dhabi, in a sign of the steady loosening of laws around alcohol in the region, AFP reports. Chad McGehee, co-founder of Craft, said the brewery was using local ingredients including honey, dates, coffee and karak tea to produce unique flavors. He hoped the business would help make the emirate a destination people to come to for beer, “like Germany, New York or San Diego.”
⚽ Teething Problems: Saudi Arabia’s billion-dollar splurge on football stars is yet to truly pay off, with the new-look Saudi Pro League failing to produce international accolades and suffering from a lop-sided season where PIF-owned Al Hilal remain unbeaten. But administrators say the league is a work in progress, AFP reports.
📷 Photo of The Day
🗓️ Circuit Calendar
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 20-21, New York City: SALT iConnections. SALT brings together more than 1,500 asset owners, asset managers and entrepreneurs for curated capital introductions and panel discussions. The Glasshouse.
May 20-22, Riyadh, Saudi Arabia: Future Aviation Forum. Airline executives, investors and government ministers gather for the third annual conference on the aviation industry. King Abdulaziz International Conference Center.
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.