Egypt’s NSGB drops after QNB deal; most Mideast markets slip

Updated 13 December 2012
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Egypt’s NSGB drops after QNB deal; most Mideast markets slip

DUBAI: Shares in Egypt’s National Societe Generale Bank plunged after parent Societe Generale’s agreed to sell its majority stake to Qatar National Bank, dragging Cairo’s bourse from a three-week high.
QNB’s deal valued the entire bank at $2.6 billion, which is less than the bank’s current market value of about $ 2.7 billion, according to Reuters’ data.
NSGB dropped 10 percent to finish at 35.42 pounds ($ 5.75), near the deal price.
SocGen is selling its 77 percent stake in NSGB for $ 2 billion, although QNB has to offer to buy the remaining stock for the same price under Egyptian market rules.
“At 1.9-times book value, it’s a fair price. QNB is over-capitalized and the NSGB deal will help them maintain a higher than 18 percent ROE (return on equity),” said Ali Adou, portfolio manager at The National Investor.
The valuation for NSGB — below market value — also weighed on other banks. Commercial International Bank declined 3.4 percent.
Most other stocks gained. Palm Hills Development rallied 7 percent and Orascom Telecom gained 3.8 percent.
Cairo’s index advanced 0.09 percent, up 42.1 percent year-to-date. The market volatility has reduced ahead of a vote on a draft referendum on Saturday.
Elsewhere, UAE markets ended mixed and the country’s two telecom operators remained actively traded stocks after the government set new royalty fees earlier this week.
Shares in Abu Dhabi’s Etisalat rose 3.1 percent, recovering from Wednesday’s six-month low.
The stock plunged after the government on Monday said Etisalat would now pay royalties, or taxes, on revenue as well as profit. The government also said it would steadily increase royalty fees for du over the next few years.
Analysts say the decline was overdone and firms will benefit from extra cash in the short term. The two telecom operators anticipated higher royalties and provisioned accordingly for the first three quarters of 2012.
Dubai-listed du resumed its decline after Tuesday’s small gain. The stock fell 1.7 percent to AED 3.45, its lowest close since Sept. 26.
“We...see a major positive catalyst in two and a half months time — du is poised to announce record profits for the fourth quarter of the year 2012 due in early March 2013,” Peter Molik, chief financial officer and head of financial advisory at MENA Corp. said in a note.The company changed its recommendation for du to ‘buy’ from ‘hold’ with a target price of AED 4.
Abu Dhabi’s measure bucked the regional trend and gained 0.3 percent, but closes 2.3 percent lower for the week. Dubai’s benchmark slipped 0.2 percent, down 1.5 percent this. Declines on the two telecom operators were the main drag.
In Qatar, the index slipped 0.2 percent, extending year-to-date losses to 5.1 percent.
Losers outnumbered gainers 13 to five. Commercial Bank of Qatar fell 2.4 percent and Qatar Telecom shed 1.4 percent.
Shares in Qatar National Bank (QNB) bucked the trend and gained 0.9 percent the day after announcing its Egyptian buy.
Elsewhere, Kuwait’s benchmark and Oman’s measure ended flat.


Airbus warns could leave Britain if no Brexit deal

Updated 22 June 2018
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Airbus warns could leave Britain if no Brexit deal

  • Industry analysts say Airbus would be unlikely to pull out of the UK abruptly because of long lead times and waiting lists for its planes
  • Airbus, which makes wings for all its passenger jets in the UK, said that leaving both the EU’s single market and customs union immediately

PARIS: European aviation giant Airbus warned Thursday it could be forced to pull out of the UK if Britain leaves the European Union without a deal.
In a Brexit risk assessment, Airbus said Britain withdrawing from the EU without a deal “would lead to severe disruption and interruption of UK production.”
“This scenario would force Airbus to reconsider its investments in the UK, and its long-term footprint in the country, severely undermining UK efforts to keep a competitive and innovative aerospace industry, developing high value jobs and competences,” it warned.
“Put simply, a no deal scenario directly threatens Airbus’ future in the UK,” Tom Williams, chief operating officer of Airbus Commercial Aircraft, said in a statement.
In its risk assessment, Airbus said under a “no deal” scenario, delays and disruptions to its production could cost it up to one billion euros ($1.2 billion) a week in lost turnover.
It said a no-deal Brexit “would be catastrophic” for the aviation group.
Airbus employs 14,000 people at more than 25 sites in Britain, where it manufactures the wings of its aircraft.
“In any scenario, Brexit has severe negative consequences for the UK aerospace industry and Airbus in particular,” Williams said.
“While Airbus understands that the political process must go on, as a responsible business we require immediate details on the pragmatic steps that should be taken to operate competitively,” he said.
“Without these, Airbus believes that the impacts on our UK operations could be significant. We have sought to highlight our concerns over the past 12 months, without success.”
On the future trade relationship between Britain and the EU, Airbus said the current transition period, which runs until December 2020, “is too short for the EU and UK Governments to agree the outstanding issues, and too short for Airbus to implement the required changes with its extensive supply chain.”
“In this scenario, Airbus would carefully monitor any new investments in the UK and refrain from extending the UK suppliers/partners base.”
Britain is due to leave the European Union in March 2019 but continue the current trading arrangements during the transition phase to December 2020 to give time for the two sides to agree the terms of a new partnership.