North Africa/Middle East

Egypt’s EFG Hermes will expand its debt restructuring and securitisation activities next year, the co-head of its investment banking division said. Hermes is advising on four merger and acquisition (M&A) deals expected in the first half of 2019 as well as a major M&A deal in Saudi Arabia’s health sector due to be completed next year, Mostafa Gad told Reuters. Hermes, the Middle East’s largest investment bank, operates in countries including Egypt, the United Arab Emirates, Saudi Arabia, Kuwait, Oman, Pakistan and Jordan, Reuters reported.

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A Saudi business empire that defaulted on billions in loans during the global financial crisis is trying to settle its debts through the kingdom’s new bankruptcy laws, posing a test for Crown Prince Mohammed bin Salman’s economic modernization efforts, The Wall Street Journal reported. Ahmad Hamad Algosaibi and Brothers sparked a nearly decadelong dispute in 2009 when the firm defaulted on loans from a range of international and regional banks, leading to accusations of financial impropriety.

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Conglomerate Ahmad Hamad Algosaibi and Brothers (AHAB) has become the first company to file for a settlement under Saudi Arabia’s new bankruptcy law, seeking to resolve the kingdom’s longest-running and largest debt dispute, Reuters reported. The company hopes the move will help to bring a conclusion to creditor talks that have rumbled on since AHAB and Saad Group defaulted on about $22 billion of debt in 2009. The law, which came into effect in August 2018, is the latest of the kingdom’s reforms aimed at attracting foreign investment and reducing the economy’s dependence on oil.

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One of Saudi Arabia’s major contractors defaulted on almost $2 billion after a falling out among its owners and delays in payments from the government, according to people with knowledge of the matter, Bloomberg News reported. The Saudi unit of Cyprus-based Joannou & Paraskevaides Group defaulted on about 7 billion riyals ($1.9 billion) in bank loans about two months ago, said the people, asking not to be identified as the information is private. The defaults are largely the result of problems getting paid by the Ministry of Interior, the people said.

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Arif Naqvi, founder of troubled buyout firm Abraaj, is making a last-ditch effort to rescue the remaining business of what was once one of the largest investors in emerging markets. The $13.6 billion (10.63 billion pounds) company crumbled this year following turmoil triggered by a row with investors, including the Gates Foundation, over the use of their money in a healthcare fund, the International New York Times reported on a Reuters story.

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A surge in Oman’s international bond yields suggests that, with investor concerns about its twin deficits growing, the country is fast replacing Bahrain as the weak debt market link among Gulf Arab oil exporters, Reuters reported. Oman’s January 2023 dollar bond yield has jumped 81 basis points since end-September, making Oman by far the worst performer in the six-nation Gulf Cooperation Council. Saudi Arabia, the second worst, has seen its March 2023 bond yield rise just 44 bps, amid concern the killing of dissident Jamal Khashoggi could hurt ties with the West.

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Emaar Properties PSJC reported the lowest quarterly profit in almost three years, showing that Dubai’s lengthening real estate slump is starting to weigh down even its most resilient builders, Bloomberg News reported. Emaar, which built the world’s tallest tower in the Persian Gulf emirate, said third-quarter profit dropped by 29 percent, missing estimates. That follows earnings slumps and losses at competitors amid signs that the slowdown may continue for years longer than anyone had predicted.

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Saudi Arabia will start auctioning real estate assets of billionaire Maan al-Sanea and his company on Dec. 2 to help repay billions of dollars due to creditors, sources familiar with the matter told Reuters. The auction, originally planned for late October in the city of Khobar in Eastern Province, was delayed by a last-ditch attempt to reach a settlement, which failed to gain enough support from creditors, one source said, Reuters reported.

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Dubai-based construction giant Arabtec has confirmed that it has hired New York-based investment bank Moelis & Co to advise on a new restructuring plan, Arabian Business reported. The company, which last year embarked on a three-phase roadmap to stabilise and prepare the business for growth, said one of the strategic objectives for 2018, Prepare, is to continue to strengthen its balance sheet, including the refinancing of debt to provide a sustainable platform for continued growth.

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