Brookfield to Buy Network International for £2.2 Billion, Hudson Bay Expands $20 Billion Hedge Fund Business to Dubai, Turkey’s Simsek Promises ‘Credible Program’ for Economy.
Global Banks Try to Put a Number on Turkish Rate Hike This Month
Key Takeaways
Economists at major global banks have divergent views on how Turkey will raise interest rates following President Erdogan’s re-election.
Some banks predict a hike of 16.5 percentage points, while others predict two consecutive increases of five percentage points or a key rate of 35% in October.
The appointment of former Merrill Lynch strategist Mehmet Simsek as treasury and finance minister suggests a pivot to orthodox economic policies may be in the cards.
Turkey’s Simsek Promises ‘Credible Program’ for Economy
Key Takeaways
Turkey’s new Finance Minister plans to build a new team and design a credible program to unwind the low-interest rate policy and address the cost-of-living crisis.
President Erdogan’s unorthodox economic policy based on low borrowing costs has led to inflation, depleted foreign reserves, and an exodus of foreign investors.
The appointment of former Merrill Lynch strategist Mehmet Simsek has intensified expectations of a change in Turkey’s approach, potentially reducing state intervention in the currency market and raising borrowing costs.
Egypt’s Asset-Sale Plan May Get a $2 Billion Boost as Suitors Eye Power Plant
Key Takeaways
Actis LLP and Edra Power Holdings Sdn Bhd are considering buying a major Egyptian power plant in a deal that may be worth around $2 billion.
The sale of the state-owned plant would help Egypt ease one of the largest debt burdens in the Middle East.
The purchase would also involve a power-purchasing agreement and potentially the highest-valued individual deal of all.
Read more.
Oil Traders Are Daring to Defy Market Kingpin Saudi Arabia
Key Takeaways
Traders are becoming less responsive to Saudi Arabia’s oil production cuts despite concerns about oil demand outstripping supply.
Concerns about the fate of China’s economy and rising supplies are fueling bears’ confidence in the oil market.
Despite the risk, some investors remain hopeful of meaningful market tightening in the second half of the year due to supply cuts by OPEC+ and emerging market demand growth.
Qatar’s Top Dealmakers Get Ready for a Spending Power Boost
Key Takeaways
Qatar Investment Authority (QIA) is targeting investments in new frontiers and sectors like technology and health care, with increased spending in Asia and the US.
QIA plans to increase its tech investments, with a focus on the semiconductor sector and software, and is looking closely at China for investment opportunities.
QIA is also eyeing a more prominent position in the economic growth story of Qatar itself, with plans to deepen the country’s capital markets and fill gaps in the local economy where the private sector cannot compete.
Hudson Bay Expands $20 Billion Hedge Fund Business to Dubai
Key Takeaways
Hudson Bay Capital Management is opening an office in Dubai to expand its business in the Middle Eastern region.
The firm has hired Chiara Chabanne as senior executive officer and its first portfolio manager in the region.
Dubai is becoming a new hedge fund hub as more investment firms, including Millennium Management and ExodusPoint Capital Management, are moving into the city.
Brookfield to Buy Network International for £2.2 Billion
Key Takeaways
Brookfield Asset Management has agreed to acquire Network International Holdings for $2.8 billion to expand its presence in credit card processing in the Middle East.
The deal is another boost for the UK’s buyout market, coming a week after EQT AB agreed to buy UK veterinary drugmaker Dechra Pharmaceuticals for £4.46 billion.
Abu Dhabi Commercial Bank, First Abu Dhabi Bank and Standard Chartered are underwriting the debt being used to finance the Network International takeover.
IMF Mideast Head Steps Aside Amid Lebanon Presidency Nominations
Key Takeaways
Jihad Azour, the head of the IMF’s Middle East and Central Asia division, is stepping down temporarily due to a conflict of interest after being nominated for president by Lebanese lawmakers.
It is unclear whether Azour, a former finance minister in Lebanon, is interested in the presidency and declined to comment earlier this month.
Lebanon’s complex political system means the presidency is usually given to a Christian, and Azour may be up against other candidates such as Sleiman Franjieh.
PGA Golf Merger Is Saudi Arabia’s Biggest Soft Power Win Yet
Key Takeaways
Saudi Arabia is using its vast oil riches to invest billions in global sports to boost its soft power and change its reputation on the global stage.
The merger of the PGA Tour and LIV Golf is a major victory for Saudi Arabia’s sports investment strategy, which aims to position the country as a destination for international events and showcase a modern image to the world.
The sports investment strategy has critics who argue that it is a way for the kingdom to deflect from its poor domestic record on free speech and human rights.