CRIF GULF WEEKLY INSIGHTS Wishing our readers a Prosperous and Happy New Year !
Country Risk Update – Kuwait
Risk Indicator – DB4b Risk Level – Moderate
Ratings Trend – Stable
Kuwait’s Business opportunities should increase as the government targets a more diverse economy with its national development plan. Kuwait’s ranking in the influential Global Competitiveness Index disappoints, falling by 14 places to leave it ranked 52nd globally.
Gulf Islamic Investments Buys Amazon’s Logistics Centres For $144 Million
A.E.-based Gulf Islamic Investments (GII), an Islamic financial services company acquired Amazon’s logistics centres covering an area of nearly one million square feet for $144 million.The logistics centres—newly built facilities—are leased out to Amazon on a long-term unbreakable lease with regular rental uplifts according to Germany Consumer Price Index (CPI).Commenting on the announcement, Mohammed Al-Hassan, Co-founder and CEO of GII said, “GII’s real estate investment strategy is to have an exposure to good yielding commercial assets with investment grade tenants. We believe this transaction perfectly matches our investment strategy”.
Saudi Aramco Launches Joint Venture to Build Shipyard
Saudi Aramco and several partners have officially launched International Maritime Industries (IMI), a joint venture to build a shipyard on Saudi Arabia’s east coast, according to a statement released by the state-owned oil giant in late December 2017.Saudi Aramco created the venture along with partners including U.A.E-based engineering firm Lamprell Plc, National Shipping Company of Saudi Arabia (Bahri) and South Korea’s Hyundai Heavy Industries Co. IMI is designed to localize links to Saudi Aramco’s supply chain related to offshore drilling and shipping activities. Initial production and service operations are expected to commence in 2019, with the facility reaching its full operational capacity by 2022.
KIPCO Closes $331 Million Seven-Year Bond Issue In the first ever seven-year corporate dinar bond issued in Kuwait, KIPCO—the Kuwait Projects Company (Holding)—announced that it has successfully completed the issuance of a $331 million (KD 100 million) bond.Oversubscribed 1.45 times, the bonds were issued in fixed and floating rate tranches. Upon closing, the fixed rate bond attracted 36% of the transaction allocation and the floating rate bond 64%.The fixed rate bond pays investors a coupon of 5.25% annually, while the floating rate bond pays investors a coupon of 2.25% annually over the declared Central Bank of Kuwait discount rate, with a cap of 1% over the fixed-rate coupon. The bonds were issued at par and will pay coupons semi-annually in arrears.
IPIC Receives $600 Million From 1Malaysia Development Berhad and Ministry Of Finance Malaysia Abu Dhabi owned IPIC—which merged with another government entity Mubadala earlier this year—received over $600 million on December 27 from Ministry of Finance (Incorporated) Malaysia (MoF Inc.) and 1Malaysia Development Berhad (1MDB), in line with an Arbitration Tribunal making a consent award by May 31, 2017.According to the ruling, IPIC was to receive an amount of $603 million by July 31, 2017, which they actually received in August 2017 and a further payment of the same amount by December 31, 2017.
Union Properties To List Subsidiary On DFM Real estate developer, Union Properties has announced the decision to raise capital for its facilities management subsidiary, ServeU through an initial public offering (IPO) in the second half of January 2018. The group is said to list the shares on Dubai Financial Market (DFM) and will invest the proceeds from the IPO to enhance its operations and develop an investment portfolio. ServeU has multiple services like property maintenance, general maintenance, security, cleaning, waste transportation and landscaping. The company has aligned itself with Union Properties’ new strategies which focus on enhancing its investments, diversifying revenue sources and expanding into new markets.
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