Over at Nasdaq Dubai, chief executive Jeff Singer is facing a tricky little dilemma - how to sustain his exchange's ambitions to be the pre-eminent financial marketplace of the Gulf region when he faces a virtual wipeout of daily trading activity.
Coming up to the end of his first year in charge of Nasdaq Dubai, Singer has steered it through the crash of the global financial system, added some new listings, initiated a controversial but potentially lucrative derivatives trading programme, and drawn up some pretty ambitious plans for regional expansion.
But all that could be put at risk if the suggested deal goes through to sell a chunk of shares in DP World, the global ports operator and ND's biggest stock by far. A sale of the DP World (DPW) free float would reduce daily trading volumes to a trickle, undermining Nasdaq Dubai's plans to create a real international exchange in the Gulf.
Just how important DPW is to Nasdaq Dubai can been gauged from last Thursday's trading statistics. Of the 4.4 million or so shares traded, 4.1 million were those of DPW. Of the 35 securities listed on ND, only three were traded, and DPW was by far the biggest. It has been the same virtually every day since DPW floated in 2007.
Last month trading in DPW was temporarily suspended pending an announcement, which eventually informed the world that DPW was in talks that could lead to the sale of a large stake to a private equity group.
No further details were provided - and indeed the absence of specifics about the proposed deal was underlined at DPW's recent annual meeting - but informed speculation had it that the putative bidder was Abraaj Capital, the region's biggest private equity group.
You can see why Abraaj might want a chunk of DPW. At 39 cents per share, the company looks extremely good value, certainly when compared with its float price of $1.30. Since the acquisition of the P&O business in 2006, DPW has become a truly world-class organisation, even against the background of global recession.
When recovery arrives, the international shipping business will be one of the first sectors to benefit. DPW will generate cash at a rate fast enough to satisfy even the hungriest private equity company.
The problem - and the root of Singer's dilemma - was the fact that DPW said the shares for sale would come "largely" from the free float of stock traded on Nasdaq Dubai. That amounts to 23 per cent of the total, with the balance held by government-owned Dubai World.
As it emerged that Abraaj was looking for a stake of around 15 per cent, this would leave only a minimal number of shares in the public domain.
Delisting of DPW would be a real possibility.
It must be stressed that the whole issue is clouded with uncertainties. Where did the pressure come from to consider a share sale? If it was from the majority owner, Dubai World, the logic is difficult to grasp. In these cash-strapped times, Dubai World needs resources for other parts of its business, notably the property group, Nakheel. But this need could only be satisfied if the shares were sold from Dubai World's 77 per cent holding. If the cash went to the private investors of the free float, it would only end up back in the great melting pot of international equity funds.
Other uncertainties have emerged since. As the silence about the deal continued, some observers began to question whether the Abraaj approach was serious, or whether Abraaj was a stalking horse for a bigger investor, perhaps even a trade partner, for DPW. With no further clarity emerging, there is a reasonable chance the Abraaj talks will stall, perhaps on the question of price.
The 23 per cent stake is valued at around $1.5 billion in the market. Add on a decent seller's premium, and you quickly get to a minimum price tag of $2 billion to take DPW private. Abraaj is cash-rich, with nearly $3 billion in its latest buyout fund, but perhaps it does not want to put so many of its eggs in the DPW basket.
There is another issue of importance for Dubai Inc. Since the P&O deal, DPW has been a shining example of good governance and international best practice in a region where such qualities are sometimes in short supply.
It has put in place audit and remuneration committees to meet the most exacting of international global standards, and run board meetings along globally recognised lines. All that could be threatened if it were taken private.
A far more practical transaction would be for Dubai World to consider selling a portion of its DPW shares, either to Abraaj or some other private equity group, or to a trade investor. That would raise cash for the Dubai Government, but retain the public listing and corporate ethos of DPW.
It would also avoid a major problem for Nasdaq Dubai. Singer has other planned listings on the agenda. He also has some grand plans for regional expansion, and ideas on how to overcome the problems of a region which simply has too much exchange capacity - this relates to the Gulf in general, but the UAE in particular.
Some experts think the post-crisis financial world will be ready for a new wave of consolidation of stock exchanges. As a vibrant and ambitious centre, Nasdaq Dubai is well placed to be a prime mover in this new regime. If it loses DP World, the jewel in its crown, it could find itself on the sidelines.
fkane@thenational.ae
Our legal columnist
Name: Yousef Al Bahar
Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994
Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers
Sarfira
Director: Sudha Kongara Prasad
Starring: Akshay Kumar, Radhika Madan, Paresh Rawal
Rating: 2/5
Why does a queen bee feast only on royal jelly?
Some facts about bees:
The queen bee eats only royal jelly, an extraordinary food created by worker bees so she lives much longer
The life cycle of a worker bee is from 40-60 days
A queen bee lives for 3-5 years
This allows her to lay millions of eggs and allows the continuity of the bee colony
About 20,000 honey bees and one queen populate each hive
Honey is packed with vital vitamins, minerals, enzymes, water and anti-oxidants.
Apart from honey, five other products are royal jelly, the special food bees feed their queen
Pollen is their protein source, a super food that is nutritious, rich in amino acids
Beewax is used to construct the combs. Due to its anti-fungal, anti-bacterial elements, it is used in skin treatments
Propolis, a resin-like material produced by bees is used to make hives. It has natural antibiotic qualities so works to sterilize hive, protects from disease, keeps their home free from germs. Also used to treat sores, infection, warts
Bee venom is used by bees to protect themselves. Has anti-inflammatory properties, sometimes used to relieve conditions such as rheumatoid arthritis, nerve and muscle pain
Honey, royal jelly, pollen have health enhancing qualities
The other three products are used for therapeutic purposes
Is beekeeping dangerous?
As long as you deal with bees gently, you will be safe, says Mohammed Al Najeh, who has worked with bees since he was a boy.
“The biggest mistake people make is they panic when they see a bee. They are small but smart creatures. If you move your hand quickly to hit the bees, this is an aggressive action and bees will defend themselves. They can sense the adrenalin in our body. But if we are calm, they are move away.”
How to vote
Canadians living in the UAE can register to vote online and be added to the International Register of Electors.
They'll then be sent a special ballot voting kit by mail either to their address, the Consulate General of Canada to the UAE in Dubai or The Embassy of Canada in Abu Dhabi
Registered voters mark the ballot with their choice and must send it back by 6pm Eastern time on October 21 (2am next Friday)
SANCTIONED
- Kirill Shamalov, Russia's youngest billionaire and previously married to Putin's daughter Katarina
- Petr Fradkov, head of recently sanctioned Promsvyazbank and son of former head of Russian Foreign Intelligence, the FSB.
- Denis Bortnikov, Deputy President of Russia's largest bank VTB. He is the son of Alexander Bortnikov, head of the FSB which was responsible for the poisoning of political activist Alexey Navalny in August 2020 with banned chemical agent novichok.
- Yury Slyusar, director of United Aircraft Corporation, a major aircraft manufacturer for the Russian military.
- Elena Aleksandrovna Georgieva, chair of the board of Novikombank, a state-owned defence conglomerate.
What is Folia?
Prince Khaled bin Alwaleed bin Talal's new plant-based menu will launch at Four Seasons hotels in Dubai this November. A desire to cater to people looking for clean, healthy meals beyond green salad is what inspired Prince Khaled and American celebrity chef Matthew Kenney to create Folia. The word means "from the leaves" in Latin, and the exclusive menu offers fine plant-based cuisine across Four Seasons properties in Los Angeles, Bahrain and, soon, Dubai.
Kenney specialises in vegan cuisine and is the founder of Plant Food Wine and 20 other restaurants worldwide. "I’ve always appreciated Matthew’s work," says the Saudi royal. "He has a singular culinary talent and his approach to plant-based dining is prescient and unrivalled. I was a fan of his long before we established our professional relationship."
Folia first launched at The Four Seasons Hotel Los Angeles at Beverly Hills in July 2018. It is available at the poolside Cabana Restaurant and for in-room dining across the property, as well as in its private event space. The food is vibrant and colourful, full of fresh dishes such as the hearts of palm ceviche with California fruit, vegetables and edible flowers; green hearb tacos filled with roasted squash and king oyster barbacoa; and a savoury coconut cream pie with macadamia crust.
In March 2019, the Folia menu reached Gulf shores, as it was introduced at the Four Seasons Hotel Bahrain Bay, where it is served at the Bay View Lounge. Next, on Tuesday, November 1 – also known as World Vegan Day – it will come to the UAE, to the Four Seasons Resort Dubai at Jumeirah Beach and the Four Seasons DIFC, both properties Prince Khaled has spent "considerable time at and love".
There are also plans to take Folia to several more locations throughout the Middle East and Europe.
While health-conscious diners will be attracted to the concept, Prince Khaled is careful to stress Folia is "not meant for a specific subset of customers. It is meant for everyone who wants a culinary experience without the negative impact that eating out so often comes with."
Your Guide to the Home
- Level 1 has a valet service if you choose not to park in the basement level. This level houses all the kitchenware, including covetable brand French Bull, along with a wide array of outdoor furnishings, lamps and lighting solutions, textiles like curtains, towels, cushions and bedding, and plenty of other home accessories.
- Level 2 features curated inspiration zones and solutions for bedrooms, living rooms and dining spaces. This is also where you’d go to customise your sofas and beds, and pick and choose from more than a dozen mattress options.
- Level 3 features The Home’s “man cave” set-up and a display of industrial and rustic furnishings. This level also has a mother’s room, a play area for children with staff to watch over the kids, furniture for nurseries and children’s rooms, and the store’s design studio.
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
'The Woman in the House Across the Street from the Girl in the Window'
Director:Michael Lehmann
Stars:Kristen Bell
Rating: 1/5
The biog
Name: Marie Byrne
Nationality: Irish
Favourite film: The Shawshank Redemption
Book: Seagull by Jonathan Livingston
Life lesson: A person is not old until regret takes the place of their dreams
Saturday's schedule at the Abu Dhabi Grand Prix
GP3 race, 12:30pm
Formula 1 final practice, 2pm
Formula 1 qualifying, 5pm
Formula 2 race, 6:40pm
Performance: Sam Smith
German plea
Ukrainian President Volodymyr Zelenskyy told the German parliament that. Russia had erected a new wall across Europe.
"It's not a Berlin Wall -- it is a Wall in central Europe between freedom and bondage and this Wall is growing bigger with every bomb" dropped on Ukraine, Zelenskyy told MPs.
Mr Zelenskyy was applauded by MPs in the Bundestag as he addressed Chancellor Olaf Scholz directly.
"Dear Mr Scholz, tear down this Wall," he said, evoking US President Ronald Reagan's 1987 appeal to Soviet leader Mikhail Gorbachev at Berlin's Brandenburg Gate.
UAE squad
Ali Kashief, Salem Rashid, Khalifa Al Hammadi, Khalfan Mubarak, Ali Mabkhout, Omar Abdelrahman, Mohammed Al Attas (Al Jazira), Mohmmed Al Shamsi, Hamdan Al Kamali, Mohammad Barghash, Khalil Al Hammadi (Al Wahda), Khalid Eisa, Mohammed Shakir, Ahmed Barman, Bandar Al Ahbabi (Al Ain), Adel Al Hosani, Al Hassan Saleh, Majid Suroor (Sharjah), Waleed Abbas, Ismail Al Hammadi, Ahmed Khalil (Shabab Al Ahli Dubai) Habib Fardan, Tariq Ahmed, Mohammed Al Akbari (Al Nasr), Ali Saleh, Ali Salmeen (Al Wasl), Hassan Al Mahrami (Baniyas)
