The Daily Circuit
đź‘‹ Hello from the Middle East!
Today in The Daily Circuit, we’re looking at blazing temperatures afflicting 2 million pilgrims to Mecca, a shipping industry call for protection from attacks on the Red Sea, a mammoth acquisition in Greece by UAE renewables firm Masdar and Saudi Arabia’s outreach to family offices in Latin America. But first, Abu Dhabi earns plaudits from Silicon Valley trackers of startup data.
From developing new permutations for online payment to addressing food security and climate change, Abu Dhabi has turned into the region’s most fertile greenhouse for tech startups. A new report by San Francisco-based Startup Genome and the Global Entrepreneurship Network ratifies the phenomenon that has become evident in a daily flow of product and funding announcements from fledgling companies in the UAE capital.
The Global Startup Ecosystem Report identifies Abu Dhabi as the fastest-growing startup ecosystem in the Middle East and North Africa region, measuring a 28% growth rate between July 2021 and December 2023. The Silicon Valley data tracker also highlights key players in Abu Dhabi that are nurturing the startup cradle, including Mubadala, ADQ, the Abu Dhabi Investment Office (ADIO), startAD, and the Abu Dhabi Department of Economic Development.
Collaborations with the sovereign wealth funds and other UAE institutions have facilitated a soft-landing for startups in Abu Dhabi from around the world, providing them with access to capital and commercial opportunities, the report says. As a result, Abu Dhabi’s Hub71 community now hosts more than 315 startups that have collectively raised $1.5 billion, the report says.
The GSER, analyzes data from over 4.5 million companies across more than 300 entrepreneurial innovation ecosystems. Abu Dhabi’s ranking jumped 15 spots compared to the previous year, based on $284 million in total early-stage funding and $1.06 billion in total venture capital funding from 2019 to 2023.
đź“° Developing Stories
GETTING HOTTER
Hundreds of Hajj pilgrims in Saudi Arabia have died and thousands more have been treated for heat exhaustion, amid extreme temperatures in Mecca since the pilgrimage began on Friday. At least 562 pilgrim deaths have been reported by foreign ministries, with Egypt alone registering 307 deaths and another 118 missing, Reuters reports. While Saudi authorities have attempted to mitigate the heat, constructing shaded areas and handing out water at regular intervals, they are contending with a crowd of nearly 2 million people and temperatures soaring dangerously above 51 C (124 F). Climate scientists say it is a warning of what is to come, with the world on track to reach 1.5 C of warming in the 2030s. While the Hajj is now shifting towards the cooler months in the lunar calendar, it is expected to coincide with the peak of summer again by the 2040s. “It is going to be very fatal,” Fahad Saeed, a climate scientist at Climate Analytics based in Pakistan, told Reuters. It comes as the wider region is struggling with early heatwaves this year, with Kuwait forced to make scheduled power cuts in some parts to cope with high demand. Rolling power cuts also hit Egypt last week as temperatures rose above 40 C in Cairo much earlier than usual.
SHIPPERS’ LAMENT
Cargo shippers, cruise boat owners and insurers are calling for urgent action to put an end to eight months of attacks by Yemen’s Houthis on commercial vessels in the Red Sea. “We call for states with influence in the region to safeguard our innocent seafarers and for the swift de-escalation of the situation in the Red Sea,” 14 of the world’s biggest shipping companies said in a joint statement issued on Wednesday. The signatories are: Asian Association of Shipowners, Bimco, CLIA, ECSA, Intermanager, Intercargo, IAPH, ICS, IFMSA, IMEC, International Maritime Pilots Association, IPTA, FONBASA, and World Shipping Council. Insurance industry sources said that additional war risk premiums, paid when vessels sail through the Red Sea, had hovered close to 0.7% of the value of a ship in recent days after rising to as much as 1% earlier this year, Reuters reports. They say more attacks are likely to push insurance rates higher, adding hundreds of thousands of dollars of extra costs to every voyage.
đź’˛ Sovereign Circuit
ADQ: Masdar, the alternative energy company jointly owned by ADQ’s TAQA, Mubadala and ADNOC, will acquire Greek renewables company Terna Energy in a deal which represents the Athens Stock Exchange’s biggest ever energy transaction. Masdar will initially acquire 67% of the company’s outstanding shares, after which it will launch an all-cash mandatory offer to acquire the remaining shares, in a deal that values Terna at $3.4 billion
Mubadala: The Abu Dhabi sovereign wealth fund expanded its stake in Princeton, N.J.-based Certara, a developer of biosimulation software, buying shares worth $169 million, which follows its $250 million purchase in 2021. Meanwhile, Iambic Therapeutics, a US-based clinical-stage biotechnology company, has raised $50 million in Series B extension funding led by Mubadala Capital. Participants included the Qatar Investment Authority, Exor Ventures and Tao Capital Partners.
Public Investment Fund: PGA Tour commissioner Jay Monahan said that recent discussions with Saudi Arabia’s Public Investment Fund are headed in a positive direction towards potential unification with the PIF-backed LIV Golf tournament.
Abu Dhabi Investment Authority: ADIA has acquired a minority stake in India-listed Paras Defense and Space Technologies Ltd for more than $7.5 million. Meanwhile, a private equity consortium led by CVC Capital Partner and ADIA subsidiary Platinum Ivy, has made a revised bid for the U.K.-based Hargreaves Lansdown valuing it at ÂŁ5.4 billion ($6.9 billion).
↪↩ Closing Circuit
💰 Top Borrower: Saudi Arabia has displaced China as the most prolific issuer of international debt among emerging markets, breaking Beijing’s 12-year run at the top, Bloomberg reports.
🚰 Drink Up: Spain’s CaixaBank and Cofides agreed to finance Spanish infrastructure developer Acciona’s part in construction of a $650 million desalination plant in Morocco.
đź’¸ Lender Rush: National Bank of Egypt, the oldest commercial bank in the country, signed a $1 billion unsecured syndicated loan facility, up from a planned $750 million after the issue was 1.7 times oversubscribed.
🛢️ Limiting Risk: Kuwait’s sovereign rating was reaffirmed by Standard & Poors at A+, the agency’s fifth highest ranking, in a report that criticized the Gulf economy’s continued dependence on oil.
đź©ş Sharper Image: Insightec, an Israeli developer of advanced ultrasound equipment, raised $150 million in a financing round led by Fidelity Management & Research Co.
đź—Ł Circuit Chatter
đź’µ Family Affair: Saudi Arabia is making a concentrated effort to boost two-way investment in trade with Latin America by connecting with family offices, Abdulrahman Bakir, managing director of the Americas for the Saudi Investment Ministry, said in an interview with Bloomberg.
🛩️ Flight Deck: Qatar Airways is expected to move forward with its purchase of a 49% stake in Rwanda’s state-owned RwandAir as early as next year, the African carrier’s Chief Executive Yvonne Makolo told the Financial Times.
đź’˛ Crypto Approval: Digital asset firm Laser Digital, the crypto arm of Japanese investment bank and brokerage Nomura, has been issued a Financial Services Permission statement, allowing it to provide services with the Abu Dhabi Global Market (ADGM).
🇧🇷 Arms Customers: Brazilian planemaker Embraer sees Saudi Arabia among the top four strategic markets for its defense unit as it looks to expand sales of the C-390 Millennium, Reuters reports, citing the head of Embraer Defense, Bosco da Costa Jr.
🌍 Power Circuit
Sheikh Mohammed bin Rashid, Prime Minister of the UAE and Ruler of Dubai, met on Wednesday with Emirates Airline President Tim Clark and commended him for the company’s record annual revenue and profit.
UAE President Sheikh Mohamed bin Zayed has issued two federal decrees forming the UAE Council for Fatwa, which will issue rulings on Islamic law, and appointing Abdullah bin Bayyah as Chairman.
Sheikh Nahyan bin Mubarak, the UAE Minister of Tolerance and Coexistence, visited Hub71 in Abu Dhabi today to highlight the nation’s support for startups.
âžż On the Circuit
Hugo Hu, Chief Financial Officer of China’s Jindong Industrials Inc., has been hired by ADIA as China chief in its private equity unit.
Riad Salameh, who was Lebanon’s Central Bank Governor for 30 years, has had a German arrest warrant against him canceled while prosecutors continue their probe and keep his assets frozen.
Ilya Sutskever, co-founder and former chief scientist at OpenAI who unsuccessfully sought to oust CEO Sam Altman, said he is starting a new company called Safe Superintelligence with offices in Palo Alto, Calif., and Tel Aviv.
Oscar de Bok, CEO of DHL Supply Chain, said in an interview with The National that the DHL Group logistics subsidiary is expanding in Saudi Arabia and the UAE, focusing on industries including energy, health care and automobiles.
🎶 Culture Circuit
🎨 Hot Exhibition: The annual Made in Tashkeel exhibition has returned to Dubai’s Al Serkal Avenue for the Summer, presenting works by more than 100 artists associated with the creative institution. Paintings, photographs, riso prints and AI-generated images by emerging artists and long-time members will bedeck the walls and floors at FN Designs until August 27.
đź“· Photo of the Day
🗓️ Circuit Calendar
June 22-23, New York City: Mubadala New York Sail Grand Prix. Flying catamarans compete at SailGP’s two-day racing festival in New York Harbor. Governors Island.
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.
July 10-11, Riyadh, Saudi Arabia: Global EV and Technology Forum. The inaugural summit in Saudi Arabia bringing together policymakers, companies and investors focused on sustainable urban mobility solutions. Riyadh International Convention & Exhibition Center.
July 15-26, Granada, Spain: ADIA Lab International Summer School. A course of lectures and case studies to explore the critical role of trust and safety in AI, examining the ethical, technical and societal implications of AI applications. University of Granada.
Aug. 12-15, Riyadh, Saudi Arabia: Saudi Food Expo. One of the kingdom’s largest trade shows for the food & beverage industry. Riyadh Front Exhibitions.