SoftBank Sells Fortress Stake to Mubadala, Management Team, Messi, Ronaldo Lead Saudi Arabia’s Multibillion-Dollar Makeover, Saudi Arabia Moves Closer to Another Aramco Stock Offering.
Messi, Ronaldo Lead Saudi Arabia’s Multibillion-Dollar Makeover
Key Takeaways
Saudi Arabia is spending billions on sports, art, and music to enhance its global image and boost tourism, despite criticism of its human rights record.
Crown Prince Mohammed bin Salman is overseeing this “soft power” strategy while also investing heavily in military capabilities and pursuing a more opportunistic diplomatic track.
The sudden influx of cultural events is popular in the country, but critics argue that it deflects attention from Saudi Arabia’s poor domestic record on free speech and human rights.
The Oil Market’s Real Weakness Is Supply, Not Demand
Key Takeaways
The recent drop in oil prices is due to an oversupply from sanctioned countries like Russia, Iran, and Venezuela, rather than a decrease in demand from slowing economies.
Despite concerns of a global economic slowdown, the International Energy Agency has actually increased its forecast for 2023 global oil demand, largely driven by strong demand in Asia.
The need for cash in sanctioned oil-producing countries has led to increased output, which has put pressure on oil prices and made it difficult for countries like Saudi Arabia to raise prices.
Saudi Arabia Moves Closer to Another Aramco Stock Offering
Key Takeaways
Saudi Arabia is considering a follow-on offering of Aramco stock that could be one of the largest share sales in recent years.
The potential offering could raise over $20 billion for the kingdom, with proceeds transferred to its sovereign wealth fund.
The boost in shareholder payouts and excess free cash may help entice new global investors to participate in the offering.
SoftBank Sells Fortress Stake to Mubadala, Management Team
Key Takeaways
Abu Dhabi’s sovereign wealth fund Mubadala Investment Co. and Fortress Investment Group are set to acquire 90% of SoftBank’s equity in the US asset manager.
Mubadala will own 70% of the equity in Fortress, while Fortress management will hold a 30% equity interest and a class of equity entitling it to appoint a majority of seats on the board.
The transaction is expected to close in Q1 2021, subject to approvals.
$730 Billion Saudi Fund Hires Goldman, Point72 Executives for New York Unit
Key Takeaways
Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), is hiring from top Wall Street firms and hedge funds to manage its growing portfolio of investments in the US through its subsidiary USSA International.
The PIF has deployed about $4.9 billion in the US this year, more than in any other region in the world, and is focusing on equity trading and compliance.
Despite having a US team, the PIF’s headquarters in Riyadh is responsible for all of its investment decisions and the fund is not planning to apply for a license to trade US stocks directly or through the New York unit.
Adnoc Unit’s $607 Million Abu Dhabi IPO Sells Out in Minutes
Key Takeaways
The initial public offering of Adnoc Logistics & Services was oversubscribed within minutes, indicating strong demand for listings in the Middle East.
Adnoc L&S plans to pay an annualized 2023 cash dividend of $260 million and expects to increase this by at least 5% annually, while targeting a compound annual growth rate of at least 10% for its revenues in the mid-term.
Adnoc has been selling stakes in its units as part of a strategy to fund the diversification of the economy and reduce its reliance on fossil fuels.
Qatar Stocks Could Attract Up to $3.5 Billion on Free Float Plan
Key Takeaways
Qatar’s equity market could attract up to $3.5 billion of passive flows if local holdings worth up to $3 billion are consolidated under a separate entity.
The new entity would hire third-party funds to actively manage and trade the shares to boost activity in the overall market.
The move could attract estimated inflows of $2.46 billion from MSCI trackers and $1 billion from FTSE trackers in a “blue sky scenario.”
Luxury Resort on Dubai’s Palm Islands Close to Selling for $280 Million
Key Takeaways
Anantara The Palm Dubai resort is close to being sold for $280 million amid a tourism boom in Dubai.
Hotel occupancy rates in Dubai averaged about 83% in the year through March, while the average daily rate during the first quarter reached $213.45.
Investors expect that Dubai’s visitor numbers could rise even further as they still haven’t returned to 2019 levels, making it an opportune time for asset owners to exit.
The Popsicle That’s Taking Over the Middle East
Key Takeaways
Dubai-based ice cream company, House of Pops, has taken the United Arab Emirates by storm with its vegan, sustainable, and healthy popsicles available in 100 hotels, cafes and restaurants, grocery stores, and 24 of their own retail locations, as well as on country’s delivery apps.
House of Pops promotes its sustainability choices, such as biodegradable packaging and a propane fuel used in most of their freezers that has less impact on global warming, as well as a healthier, plant-based alternative to many other dessert options with no refined sugar, additives or flavorings, and a keto line for those looking to go low-carb.
House of Pops is expanding rapidly, with plans to open 80 franchises across the kingdom of Saudi Arabia in the next six years, as well as launching limited edition Mickey and Minnie Mouse-branded pops, ice cream and sorbet pints, and bites dipped in 72% single origin Madagascar chocolate.