Constantin Salameh, new group chief executive, left, is undertaking a review of Al Ghurair businesses with Essa Al Ghurair, the executive vice-chairman. Mike Young / The National
Constantin Salameh, new group chief executive, left, is undertaking a review of Al Ghurair businesses with Essa Al Ghurair, the executive vice-chairman. Mike Young / The National

Al Ghurair rules out dashing into IPO



Al Ghurair Investment, the Dubai conglomerate that helped to build Burj Khalifa, would prefer to avoid public offerings of shares in its group companies in current market conditions, according to senior executives at the company.

Although Constantin Salameh, the newly appointed group chief executive, is undertaking a review of Al Ghurair businesses and will not rule out initial public offerings at some stage, both he and Essa Al Ghurair, the executive vice-chairman, will not be rushed into an IPO.

The views of such a prominent UAE corporate leader as Mr Al Ghurair, and an experienced financial technocrat such as Mr Salameh, will add weight to the growing debate over the benefits of regional IPOs, despite rising stock markets this year.

The Al Habtoor conglomerate said recently it was considering an IPO on the Nasdaq Dubai market, and perhaps a simultaneous listing abroad, as soon as next year.

Other market experts have warned that market conditions, and structures, are not suitable for IPOs in the GCC region. A planned "privatisation" programme suggested in Dubai two years ago has not yet materialised.

Asked if he would rather avoid an IPO if possible, Mr Al Ghurair said: "To a certain extent, yes. We don't want to upset anybody by doing an IPO. We have to give a good proposition to anybody who is going to buy shares in an Al Ghurair company, and we have to keep the reputation of the family intact."

"There are usually two reasons for seeking an IPO: for the funding capability, and for the governance structure it imposes on the group," said Mr Salameh.

"We are currently well-funded, with equity to debt ratios and the capital structure more than adequate for our needs. The equity/debt ratio is much lower than average."

He added that part of his strategy, agreed with the Al Ghurair board, was to raise standards of corporate governance at Al Ghurair.

"It's important we run the company in the same way as if it were a public company, with the same controls, priorities and communications. Accountability will filter down through the organisation," he said.

"The IPOs are facing more than one challenge," said Wadah Al Taha, the chief investment officer at Al Zarooni Group, an investment company based in Dubai.

"There are stocks that are very cheap. Why would investors go to a share sale when there are successful companies trading below book value? Secondly, on the company side, there is an uncertainty that it would be successful. Liquidity is still very tight and banks are hesitating to offer leverage as an incentive for investors to buy.

"For fund managers, they worry whether they can liquidate their holdings quickly in light of low turnover."

Only two companies went public in Abu Dhabi last year. Insurance House raised Dh66 million (US$17.9m). Eshraq Properties, which raised Dh825m, took the unusual approach of allowing investors to buy shares for a 25 per cent down payment, plus a fee of .02 fils a share. The balance was to be due within two years, at the direction of the company's board of directors.

Two other companies, Abu Dhabi Capital Management and NMC, listed in London, citing concerns over weak liquidity in the local markets.

Dubai has not had a share listing since Drake & Scull International went public in 2008, raising Dh124m. Habtoor Group is eyeing an IPO on the Nasdaq Dubai by next March, its chairman Khalaf Al Habtoor said earlier this year.

The value of equities traded shrank by 45 per cent to Dh57 billion last year from the previous year.

The Abu Dhabi Securities Exchange General Index has advanced 8.7 per cent since January, compared with a decline of 11.7 per cent last year. The Dubai Financial Market General Index has gained 17 per cent so far this year, compared with a decline of 17 per cent last year.

Many foreign investment banks restructured their operations in the UAE last year to cope with falling volumes. Many local stock brokerages have shut down; there are 49 securities firms in operation, compared with 103 at the beginning of last year. Shuaa Capital, a Dubai-based investment bank, on Wednesday confirmed it was closing its retail brokerage business.

Game Changer

Director: Shankar 

Stars: Ram Charan, Kiara Advani, Anjali, S J Suryah, Jayaram

Rating: 2/5

Visit Abu Dhabi culinary team's top Emirati restaurants in Abu Dhabi

Yadoo’s House Restaurant & Cafe

For the karak and Yoodo's house platter with includes eggs, balaleet, khamir and chebab bread.

Golden Dallah

For the cappuccino, luqaimat and aseeda.

Al Mrzab Restaurant

For the shrimp murabian and Kuwaiti options including Kuwaiti machboos with kebab and spicy sauce.

Al Derwaza

For the fish hubul, regag bread, biryani and special seafood soup. 

If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.

When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.

How to get there: Emirates currently flies from Dubai to Orlando five times a week.
John%20Wick%3A%20Chapter%204
%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Chad%20Stahelski%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStars%3A%3C%2Fstrong%3E%20Keanu%20Reeves%2C%20Laurence%20Fishburne%2C%20George%20Georgiou%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E4%2F5%3C%2Fp%3E%0A
How to protect yourself when air quality drops

Install an air filter in your home.

Close your windows and turn on the AC.

Shower or bath after being outside.

Wear a face mask.

Stay indoors when conditions are particularly poor.

If driving, turn your engine off when stationary.

COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
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Key facilities
  • Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
  • Premier League-standard football pitch
  • 400m Olympic running track
  • NBA-spec basketball court with auditorium
  • 600-seat auditorium
  • Spaces for historical and cultural exploration
  • An elevated football field that doubles as a helipad
  • Specialist robotics and science laboratories
  • AR and VR-enabled learning centres
  • Disruption Lab and Research Centre for developing entrepreneurial skills
WHY%20AAYAN%20IS%20'PERFECT%20EXAMPLE'
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%3Cp%3E%E2%80%A2%20Enterprise-grade%20security%20and%20privacy%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Unlimited%20higher-speed%20GPT-4%20access%20with%20no%20caps%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Longer%20context%20windows%20for%20processing%20longer%20inputs%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Advanced%20data%20analysis%20capabilities%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Customisation%20options%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Shareable%20chat%20templates%20that%20companies%20can%20use%20to%20collaborate%20and%20build%20common%20workflows%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Analytics%20dashboard%20for%20usage%20insights%3C%2Fp%3E%0A%3Cp%3E%E2%80%A2%20Free%20credits%20to%20use%20OpenAI%20APIs%20to%20extend%20OpenAI%20into%20a%20fully-custom%20solution%20for%20enterprises%3C%2Fp%3E%0A
Vidaamuyarchi

Director: Magizh Thirumeni

Stars: Ajith Kumar, Arjun Sarja, Trisha Krishnan, Regina Cassandra

Rating: 4/5

 

Paatal Lok season two

Directors: Avinash Arun, Prosit Roy 

Stars: Jaideep Ahlawat, Ishwak Singh, Lc Sekhose, Merenla Imsong

Rating: 4.5/5

MATCH INFO

Everton v Tottenham, Sunday, 8.30pm (UAE)

Match is live on BeIN Sports

RACECARD

6pm Emaar Dubai Sprint – Conditions (TB) $60,000 (Turf) 1,200m

6.35pm Graduate Stakes – Conditions (TB) $100,000 (Dirt) 1,600m

7.10pm Al Khail Trophy – Listed (TB) $100,000 (T) 2,810m

7.45pm UAE 1000 Guineas – Listed (TB) $150,000 (D) 1,600m

8.20pm Zabeel Turf – Listed (TB) $100,000 (T) 2,000m

8.55pm Downtown Dubai Cup – Rated Conditions (TB) $80,000 (D) 1,400m

9.30pm Zabeel Mile – Group 2 (TB) $180,000 (T) 1,600m

10.05pm Dubai Sprint – Listed (TB) $100,000 (T) 1,200m 

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The Sand Castle

Director: Matty Brown

Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea

Rating: 2.5/5

The Disaster Artist

Director: James Franco

Starring: James Franco, Dave Franco, Seth Rogan

Four stars

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Where to submit a sample

Volunteers of all ages can submit DNA samples at centres across Abu Dhabi, including: Abu Dhabi National Exhibition Centre (Adnec), Biogenix Labs in Masdar City, NMC Royal Hospital in Khalifa City, NMC Royal Medical Centre, Abu Dhabi, NMC Royal Women's Hospital, Bareen International Hospital, Al Towayya in Al Ain, NMC Specialty Hospital, Al Ain

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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