With the English Premier League trophy now firmly in the Manchester City cabinet, Abu Dhabi's growing influence in the British metropolis might just lead to another prized asset - Manchester Airport.
Abu Dhabi Investment Authority (Adia) is interested in bidding for a 50 per cent stake in Manchester Airports Group (MAG), it is understood.
Analysts say the bid has a better chance of being accepted by MAG and the relevant government authorities, due to the precedent set by Abu Dhabi in investing in one of the city's football clubs and expanding Etihad Airways' presence in Manchester.
"Almost certainly Etihad's growth in the city, as well as its affiliation with Manchester City, is a key factor in bringing Abu Dhabi's business expertise and management to the city," said Saj Ahmad, the chief analyst at StrategicAero Research, an aviation consultancy.
"With … Etihad making a name for itself in the city, Adia can leverage that connection to its advantage via marketing activities as well as new investment opportunities."
Manchester City won the Premier League on Sunday, following four years of heavy investment by its owner, Sheikh Mansour bin Zayed.
MAG confirmed to The National it was considering selling a stake in its operation as a way of raising funds to bid for Stansted Airport, one of the four main London airports, along with Luton, Gatwick and Heathrow. MAG, in a joint statement with its owners, the English local government body, the Association of Greater Manchester Authorities (Agma), said it was "exploring the opportunity to add a quality airport to the group."
According to media reports, Adia is bidding for a share of Manchester Airport with 3i Infrastructure, a UK investment firm. 3i declined comment yesterday.
Agma is made up of 10 different councils in the Manchester region, with Manchester City Council, the largest stakeholder with 55 per cent, and the other nine owning a 5 per cent stake each.
"Following a strategic review of the group's performance and future prospects, MAG is pursuing two key recommendations: one to explore the opportunity to add a quality airport to the Group; and the other, to bring in new equity investment as part of the deal. Both of these recommendations are interdependent and one will not happen without the other," the joint statement said.
Meanwhile, MAG confirmed it had started to invite detailed proposals from private investors.
It is understood other frontrunners for the stake in MAG are Cheung Kong Infrastructure, the investment vehicle of Asia's richest man Li Ka-shing, and Australia's Industry Funds Management.
"Even if there were no connection to the football club, the airport is a good revenue generator as well as having greater potential to grow as it's not bottlenecked with traffic like Heathrow is," said Mr Ahmad. "So it's clear Adia are investing for the long term.'
The UK's Competition Commission had ordered the Spanish-owned BAA, which owned and operated most of the UK's airports, to sell off Gatwick, Edinburgh and Stansted. The first two airports have been sold but Stansted is still not on the market pending appeals by BAA. If Stansted does come up for sale, MAG wants to have a war chest ready. The group missed out on purchasing Gatwick in 2009 by being unable to match the £1.5 billion (Dh8.86bn) price tag.
MAG would see its annual revenues grow by 80 per cent if it bought Stansted. Manchester Airport has direct flights to 220 destinations worldwide - more than any other UK airport.
rjones@thenational.ae
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FIGHT%20CARD
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Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
Company%20profile
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French business
France has organised a delegation of leading businesses to travel to Syria. The group was led by French shipping giant CMA CGM, which struck a 30-year contract in May with the Syrian government to develop and run Latakia port. Also present were water and waste management company Suez, defence multinational Thales, and Ellipse Group, which is currently looking into rehabilitating Syrian hospitals.
Your rights as an employee
The government has taken an increasingly tough line against companies that fail to pay employees on time. Three years ago, the Cabinet passed a decree allowing the government to halt the granting of work permits to companies with wage backlogs.
The new measures passed by the Cabinet in 2016 were an update to the Wage Protection System, which is in place to track whether a company pays its employees on time or not.
If wages are 10 days late, the new measures kick in and the company is alerted it is in breach of labour rules. If wages remain unpaid for a total of 16 days, the authorities can cancel work permits, effectively shutting off operations. Fines of up to Dh5,000 per unpaid employee follow after 60 days.
Despite those measures, late payments remain an issue, particularly in the construction sector. Smaller contractors, such as electrical, plumbing and fit-out businesses, often blame the bigger companies that hire them for wages being late.
The authorities have urged employees to report their companies at the labour ministry or Tawafuq service centres — there are 15 in Abu Dhabi.
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
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.”
The five pillars of Islam
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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.
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
