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The Weekly Circuit: Gulf investors in LA + BlackRock-Saudi $5B fund

👋 Hello from the Middle East! 

This week we’re looking at BlackRock’s $5 billion deal with the Saudi Public Investment Fund, S&P’s forecast for a UAE property market slowdown, the movie biz in Saudi six years after the cinema ban lifted and UAE Ambassador Yousef Al Otaiba’s vision for AI cooperation with the U.S. But first, to rub elbows with the Gulf’s financiers, take your pick of Los Angeles or Dubai in the coming days. 

Amid forecasts for another round of heavy downpours in the UAE, conference hosts will be steering investors this week to more networking opportunities in hotel ballrooms and fewer falconry expeditions in the desert.

The Dubai Financial Market’s annual Capital Market Summit is putting its focus on the proliferating opportunities for Gulf IPOs this year, kicking off Day 2 on Thursday with a panel moderated by The Circuit’s Kelsey Warner on the evolving landscape of asset management. Among those joining her will be Majed Al Mesmari, Head of Investment Banking for the MENA region at Jefferies; Jad Ellawn, Managing Partner & Regional Head, Middle East at Brookfield; and Miguel Azvedo, Vice Chairman of Investment Banking for the Middle East and Africa at Citigroup.

On Sunday, Middle East power brokers will be holding court in Beverly Hills as the Milken Institute Global Conference opens for four days of debate spanning tech, finance, diplomacy and medical research. Saudi Investment Minister Khalid Al-Falih and Ambassador to the U.S. Reema Bandar take the stage on Tuesday. Back in the UAE, the Dubai International Financial Centre holds its annual Dubai FinTech Summit on Monday and Tuesday.

BlackRock is preparing to open a multi-class investment firm in Saudi Arabia after securing a deal with the Public Investment Fund for a $5 billion anchor investment. The world’s biggest money manager will run BlackRock Riyadh Investment Management with the aim of attracting foreign investment to both the kingdom and the wider region — while building up Saudi capital markets through the funds it manages. 

The new Riyadh outpost is the latest in a flood of interest from money managers all vying for a piece of the deep-pocketed and increasingly active Gulf sovereign wealth funds. “We are excited to build on the deep partnership we have developed with PIF over many years to launch this first-of-its-kind international investment management platform in Saudi Arabia,” BlackRock CEO Larry Fink said in a statement. “Saudi Arabia has become an increasingly attractive destination for international investment . . . and we are pleased to offer investors from around the world the opportunity to take part.”

The UAE’s booming property market is unlikely to sustain the double-digit price growth witnessed in the first quarter of 2024. That’s the assessment of S&P Global Ratings, which expects real estate prices to decline by close to 10% by the end of this year. Meanwhile, Dubai Holding, the investment firm of Dubai Ruler Sheikh Mohammed bin Rashid, refinanced an $8.2 billion loan to replace older facilities at the two state-backed developers it absorbed last month – Nakheel and Meydan – better positioning itself to capitalize on the current real estate boom, Bloomberg reports.

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).

From AlUla to Cannes: Saudi film industry blooms six years after cinema ban is lifted

Actor Johnny Depp attends the Opening Night screening of “HWJN” at the Red Sea International Film Festival 2023, in Jeddah (Photo: Getty Images)

Saudi Arabia celebrated six years since cinemas reopened in the kingdom this month following a 35-year ban, Rebecca Anne Proctor reports for The Circuit.

Lights, camera, action: Filmmakers who were unable to shoot in the city streets for fear of the now-defunct religious Mutawa have returned home; the government has begun a range of incentives to encourage young Saudi filmmakers; film festivals are being staged across the kingdom and famous actors and producers from Hollywood and Bollywood are shooting in the rugged landscapes of AlUla and Neom. 

Director’s cut: Big money is now being made from Saudi Arabia’s rising film industry, with cumulative box office profits approaching the $1 billion mark.

Click here to read the full story.

‘Data is destiny,’ says UAE Ambassador to Washington

UAE Ambassador to Washington Yousef Al Otaiba.

For the Middle East, data is the new oil, according to UAE Ambassador to Washington Yousef Al Otaiba, The Circuit’s Jonathan Ferziger writes.

Limiting harm: Hailing the $1.5 billion AI deal Microsoft signed this month to invest in artificial intelligence with Abu Dhabi’s G42 company, Al Otaiba writes in a Bloomberg opinion piece that “governments must race to realize the technology’s potential – and limit its harm.”

Unleashing potential: “AI will be the lifeblood of future societies,” Al Otaiba writes. “To ensure that data is truly destiny in the new age, we must join together to promote AI’s ethical and equitable benefits for all.”

Click here to read the full story.

ADQ: The Abu Dhabi sovereign wealth fund is planning to issue its first dollar-denominated bonds, Bloomberg reports. The bond prospectus offered a rare glimpse of ADQ’s financials, revealing that the fund made a net profit in 2023 of $4.3 billion, compared to $3.3 billion in 2022. ADQ employs 85,000 people in the UAE and has directly contributed 10% to the emirate’s non-oil economy while supporting 22% of wider non-oil GDP. The UAE will tender this year for the construction of a new nuclear power plant that would double the number of reactors in the first and only Arab country to operate a nuclear plant, Reuters reports. ADQ-owned Emirates Nuclear Energy Co., which opened its Barakah facility in 2021, did not comment on whether or not it is involved. The UAE signed an agreement to triple global nuclear energy capacity by 2030 at the U.N. climate meeting COP28 in Dubai last December. 

Mubadala: Turkish grocery delivery company Getir will withdraw from European and U.S. markets to focus on Turkey with new financing from Mubadala. Meanwhile, Jared Kushner’s Affinity Partners joined the board of Brazilian fast-food operator Zamp SA after making an investment of about $200 million earlier this year alongside Mubadala Capital, Bloomberg reports. Asad Naqvi, a partner at Affinity, was elected as a board member alongside new investor Santiago Jariton, the chief investment officer at Emerging Variant Capital Management. Mubadala Capital, a wholly-owned unit of the Abu Dhabi sovereign wealth fund, owns 58% of Zamp, an operator of more than 1,000 Burger King and Popeyes restaurants in Brazil.

Public Investment Fund: Saudi Arabia’s PIF-backed NEOM mega-project obtained a $2.6 billion revolving credit facility from Saudi National Bank, Riyad Bank and seven other lenders to diversify its financing. Saudi Arabia’s Finance Minister Mohammed Al Jadaan, who sits on the PIF’s board, on Sunday said the kingdom would adapt to current economic and geopolitical challenges and “downscale” or “accelerate” some of the projects being carried out under its Vision 2030 program, speaking at the special meeting of the World Economic Forum in Riyadh. 

International Holding Co.: IHC has secured a nearly 15% stake in processed food company Grupo Nutresa, the largest in Colombia, the Abu Dhabi conglomerate said in a disclosure on the Abu Dhabi Securities Exchange on Friday.

📞 Telecom Talk: Emirates Telecommunications, known as e&, is considering the acquisition of eastern European carrier United Group BV, which could be worth as much as $8.6 billion, Bloomberg reports.

🛡️ Defense Purchase: Abu Dhabi-backed defense conglomerate EDGE has bought a controlling stake in Brazil’s CONDOR, one of the world’s biggest producers of tear gas and other so-called non-lethal technologies, for an undisclosed sum.

🇵🇰 Aramco Acquisition: A Pakistani regulatory commission approved the decision by Saudi Aramco to acquire a 40% stake in Gas & Oil Pakistan Ltd.

🌀 Oman Renewables: A consortium of Electricité de France, Japan’s J-Power and London-based Yamna was awarded a block of land by state-owned Hydrogen Oman to build a green ammonia plant and fuel renewable power projects.

🖥️ Secure Browsing: Island, an Israeli startup that provides data security for internet browsers, completed a $175 million Series D financing round, led by Sequoia Capital and Coatue. 

🏝️ Island Homes: Aldar Properties, Abu Dhabi’s biggest developer, plans to build 7,000 luxury homes in its $6.8 billion project on the city’s Al Fahid Island, Bloomberg reports. The listed developer reported an 81% jump in first-quarter net profit today on higher sales amid strong momentum for the real estate industry in the UAE. 

🐔 Food Factory: Saud Arabia’s Almunajem Foods will build a $42 million factory in Jeddah to produce poultry, red meat, seafood and dairy products.

🛢️ Oil Flow: OPEC oil output fell in April, reflecting lower exports from Iran, Iraq and Nigeria against a backdrop of ongoing voluntary supply cuts, Reuters reports.

🛫 Flight Swap: Air France-KLM Group will add flights to its North Africa routes as demand for leisure travel to Egypt and Jordan has weakened amid regional conflicts.

🇮🇷 Iran Returns: A UAE-Iran joint economic commission is convening in Abu Dhabi this week for the first time in 10 years as the Islamic Republic seeks to bolster ties with Gulf states amid U.S. pressure, Reuters reports.

🗄️ WeWork Deal: WeWork reached a settlement with creditors to move ahead with a bankruptcy deal that will enable the shared-office space company to reject a $650 million offer from co-founder Adam Neumann.

🌀 Malaysian Renewables: Saudi Arabia’s ACWA Power may invest $10 billion over 10 years to develop renewable energy projects in Malaysia, the country’s Bernama news agency reports.

💉 Polio Push: Saudi Arabia has partnered with the Bill & Melinda Gates Foundation and pledged $620 million to eradicating polio and fighting poverty across 33 Islamic Development Bank member countries. The foundation will open a regional office in Riyadh.

UAE President Sheikh Mohamed bin Zayed received a delegation from Canada’s McGill University in Abu Dhabi on Tuesday and discussed the potential for partnerships in science and technology.

Sheikh Mohamed also received the Presidential Camel Racing Team on Tuesday alongside Sheikh Mansour bin Zayed, UAE Vice President, Deputy Prime Minister and Chairman of the Presidential Court, at Qasr Al Bahr in Abu Dhabi. 

Sheikh Mohammed bin Rashid, UAE Vice President and Ruler of Dubai, commended participation levels in the 8th Arab Reading Challenge, which saw a record 28 million students from 50 countries taking part.

Sheikh Hamdan bin Mohammed, Crown Prince of Dubai and Chairman of the Dubai Executive Council, launched the Dubai Universal Blueprint for Artificial Intelligence, a yearly plan focused on harnessing technology to improve quality of life in the emirate.

Saudi Foreign Minister Prince Faisal bin Farhanchaired an Arab ministerial coordination meeting in Riyadh on Saturday, attended by Dr. Anwar Gargash, Diplomatic Adviser to the UAE President; Dr Ayman Hussein Safadi, Deputy Prime Minister of Jordan; Sameh Shukri, Egyptian Minister of Foreign Affairs; Hussein Al-Sheikh, Palestinian Minister of Civil Affairs; and Dr. Muhammad bin Abdulaziz Al-Khulaifi, Qatari Minister of State.

Dr. Sultan Al Jaber, who was President of last year’s COP28 climate conference, addressed the first board meeting for the Loss and Damage Fund on Tuesday, where he urged parties to deliver “lasting, positive, socio-economic impact” to help countries most vulnerable to climate change. At COP28, countries pledged a total of $792 million for loss and damage funding arrangements. 

Badr Al Olama, Director General of Abu Dhabi Investment Office, has been appointed Chairman of SHUAA Capital, after Fadhel Al Ali stepped down following nearly five years leading the Dubai-based asset manager and investment bank. Ahmed Alahmadi, CEO of Al Baher Real Estate, has been appointed Managing Director.

Jane Fraser, CEO of Citigroup, talked about the bank’s new Middle East, Africa and Central Asia cluster as a critical growth engine for the fourth-largest lender in the U.S., in an interview with The National on a trip through the Gulf to meet with clients. 

Staff Major General Pilot Faris Khalaf Al Mazrouei, Commander-in-Chief of Abu Dhabi Police and Chairman of the Emergency, Crises and Disaster Management Team, chaired a meeting today as UAE residents brace for more heavy rain on the way this week. Remote working and learning has been advised for Thursday and Friday. 

Oscar-nominated Lebanese filmmaker Nadine Labakihas been picked as a jury member for the 77th Cannes Film Festival. The jury, headed by “Barbie” Director Greta Gerwig, will review 22 films competing in the festival, which starts on May 14.

🎮 Game On: The third Dubai Esports and Games Festival, one of the Middle East’s most anticipated Esports events, kicks off today with a two-day expo at Dubai World Trade Centre, ahead of a weekend full of entertainment. The expo features live tournaments and a unique offering called The Narrows, during which regional artists can showcase their work. 

👠 Style Launch: French fashion mag ELLE launched a new edition in Egypt this month, led by Cairo-based media veteran Susan Sabet as Editor-in-Chief and Managing Director. The website is bilingual in English and Arabic, and the first print edition will come out in September.

TUM (Technical University of Munich) from Germany, claimed victory at the inaugural Abu Dhabi Autonomous Racing League (A2RL), at Yas Marina Circuit on Saturday. The team was congratulated on the racetrack by Sheikh Theyab bin Mohamed, Chairman of the Office of Development and Martyrs Families Affairs, who presented the Championship Trophy, along with Faisal Al Bannai (left), Secretary General of the Advanced Technology Research Council.

Apr. 29 – May 5, Abu Dhabi, UAE: Abu Dhabi International Book Fair. A key event for the publishing industry in the Middle East and North Africa. Abu Dhabi National Exhibition Center.  

May 1-2, Dubai, UAE: Capital Market Summit. A gathering of investors and entrepreneurs hosted by the Dubai Financial Market aimed at sparking interest in IPOs. Madinat Jumeirah. 

May 5-8, Los Angeles: Milken Institute Global Conference. Politicians, financiers, media and philanthropists convene to discuss challenges across themes like innovation and technology, health and medical research, diversity and inclusion. The Beverly Hilton. 

May 6-7, Dubai, UAE: Dubai FinTech Summit. The second annual gathering of financial leaders meet to spotlight innovation and discuss disruptions in the industry, organized by the Dubai International Financial Centre (DIFC). Madinat Jumeirah. 

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.