Saudi PIF buys into McLaren as part of £550m equity raise

Automotive revenues in the first quarter of this year were £170.5 million, a rise of 145 percent during the same pandemic-hit period in 2020. (Supplied)
1 / 2
Automotive revenues in the first quarter of this year were £170.5 million, a rise of 145 percent during the same pandemic-hit period in 2020. (Supplied)
Saudi PIF buys into McLaren as part of £550m equity raise
2 / 2
McLaren's Lando Norris in action during qualifying at the Formula One British Grand Prix at Silverstone on July 16, 2021. (Reuters)
Short Url
Updated 18 July 2021

Saudi PIF buys into McLaren as part of £550m equity raise

Automotive revenues in the first quarter of this year were £170.5 million, a rise of 145 percent during the same pandemic-hit period in 2020. (Supplied)
  • PIF and Ares will provide £400 million of new capital
  • £150 million will come from existing shareholders including Bahrain's Mumtalakat

RIYADH: The McLaren Group announced a £550 million ($758 million) equity investment on Friday with much of it coming from Saudi Arabia’s Public Investment Fund (PIF) and global investment firm Ares Management.

McLaren Group includes the British supercar maker as well as McLaren Racing, which competes in Formula One and IndyCar in the United States and is also entering the Extreme E off-road electric series next year.

McLaren said PIF and Ares were providing £400 million of new capital, in the form of preference shares and equity warrants.

The rest will come from existing shareholders as convertible preference shares, allowing for repayment of a loan received in June last year from the National Bank of Bahrain.

Bahrain’s Mumtalakat sovereign investment fund is McLaren’s majority shareholder with a 62.55 percent stake according to its website.

“Following the strategic investment into Racing that we secured last year, this successful equity raise is a key element of our comprehensive financial strategy to support the Group’s sustainable growth plans,” said McLaren Group’s executive chairman Paul Walsh.

“With these strong foundations now in place, we are well positioned to achieve our ambitions as a global luxury supercar and elite motorsport business, with Automotive as McLaren’s core profit driver.”

McLaren had a £300 million equity injection from existing shareholders in March 2020 and last April completed a £170 million sale and leaseback deal on its Woking headquarters.

US-based investment group MSP Sports Capital also acquired a significant minority stake in McLaren Racing last December in a deal that brought in £185 million and eased pressure from the COVID-19 pandemic.

Automotive revenues in the first quarter of this year were £170.5 million, a rise of 145 percent on the same pandemic-affected period in 2020.

While PIF’s investment in McLaren represents the first by the Kingdom, Saudi Arabia has a long relationship with the company.

Saudi billionaire Mansour Ojjeh, who died in June this year at the age of 68, bought into McLaren in 1984 and helped the team win seven of its eight Formula One titles.

McLaren CEO Zak Brown said: “Mansour has been etched into the heart and soul of this team for nearly 40 years and was intrinsic to its success.”

The Middle East is an important market for McLaren’s road cars. McLaren Automotive inaugurated a new service center, located on King Abdul Aziz Road in Riyadh, in February of this year.

The service center, operated by Nahwasharq, was conceived in response to a growing number of vehicles in the crucial Middle Eastern market.

Arab News columnist Frank Kane last year described the McLaren GT as “a little gem of a vehicle.”

“Looking at it head-on from the front, it has the threat and power of a shark,” Kane said. “The body is all flowing lines and elegant contours. The rear has just a hint of jet fighter about it.”

(With Reuters)


Amazon denies plans to accept bitcoin payments

Amazon denies plans to accept bitcoin payments
Updated 9 min 33 sec ago

Amazon denies plans to accept bitcoin payments

Amazon denies plans to accept bitcoin payments
  • The electric carmaker’s balance sheet for the second quarter of 2021 showed a net digital asset value of $1.311 billion as of June 30

RIYADH: Bitcoin traded higher on Tuesday, rising 0.55 percent to $38,379.02 at 5:02 p.m. Riyadh time. Ether, the second most traded cryptocurrency, was down 1.3 percent to $2,298.85, according to data from CoinDesk.

Below is the latest cryptocurrency news:

Amazon has denied a British newspaper report that it plans to accept bitcoin payments this year. “Notwithstanding our interest in the space, the speculation that has ensued around our specific plans for cryptocurrencies is not true,” an Amazon spokesperson said on Monday. “We remain focused on exploring what this could look like for customers shopping on Amazon.”

According to a report from Bloomberg, the popular stablecoin Tether is under criminal investigation by the US Justice Department. Prosecutors are looking into whether Tether’s executives committed bank fraud, a development with potentially seismic consequences for the broader crypto market. Tether released a statement saying that the Bloomberg report follows a pattern of repackaging old claims as news, but did not deny awareness of the pending charges, according to CoinDesk.

Goldman Sachs is liquidating and settling cryptocurrency traded products for some of its hedge fund clients in Europe, it was reported last week. The investment banking giant has submitted an application to the US Securities and Exchange Commission for an exchange-traded fund (ETF) that would showcase public companies in decentralized finance and blockchain around the world. The filing indicated that the fund plans to invest at least 80 percent of its assets in companies that are developing blockchain technology and digitizing funding. The Securities and Exchange Commission is currently reviewing more than a dozen Bitcoin ETF applications and has approved decisions on several of them, CoinDesk reported.

Tesla released its second quarter earnings report on Monday. The electric carmaker’s balance sheet for the second quarter of 2021 showed a net digital asset value of $1.311 billion as of June 30. It also showed that Tesla owns $1.311 billion in bitcoin. The company did not buy or sell any bitcoin during the second quarter, but it did report a bitcoin depreciation of $23 million. Tesla’s action reaffirms Musk’s prior statement that neither he nor Tesla had sold their coins, according to Bitcoin News.

A survey conducted by the cryptocurrency exchange of the Independent Reserve Asia Pacific found that 43 percent of respondents said they own cryptocurrency, while 46 percent plan to purchase digital assets in the next 12 months.

The survey of 1,000 Singaporeans from a representative background of gender, age and location, also found that two-thirds of respondents in the 26-45 age group said they own cryptocurrency. Nearly 40 percent of respondents described bitcoin as an investment asset and 25 percent described it as a store of value. Three-quarters of respondents aged between 26 and 35 said they believe that cryptocurrency will become more widely accepted. Singapore’s financial authorities have confirmed that they are working with their French counterparts to explore cross-border applications of central bank digital currencies, according to a report by Cointelegraph.


Fitch revises Saudi Aramco’s outlook to stable, affirms IDR at ‘A’

Fitch Ratings, the leading global credit rating agency, has revised its Saudi Aramco outlook to stable from negative. (Reuters/File Photo)
Fitch Ratings, the leading global credit rating agency, has revised its Saudi Aramco outlook to stable from negative. (Reuters/File Photo)
Updated 27 July 2021

Fitch revises Saudi Aramco’s outlook to stable, affirms IDR at ‘A’

Fitch Ratings, the leading global credit rating agency, has revised its Saudi Aramco outlook to stable from negative. (Reuters/File Photo)

RIYADH: Fitch Ratings, the leading global credit rating agency, has revised its Saudi Aramco outlook to stable from negative while affirming the company’s long-term issuer default rating (IDR) at ‘A.’

The revision of the outlook on Saudi Aramco’s IDR is driven by a similar action on the sovereign, the rating agency said in its new report published on Tuesday.


Fitch lifts 6 Saudi banks outlooks to stable from negative

Fitch lifts 6 Saudi banks outlooks to stable from negative
Updated 27 July 2021

Fitch lifts 6 Saudi banks outlooks to stable from negative

Fitch lifts 6 Saudi banks outlooks to stable from negative
  • These ratings follow a similar action on Saudi Arabia’s sovereign rating on 15 July 2021 that was attributed to better fiscal management and an increase in oil prices

RIYADH: Ratings agency Fitch has revised six Saudi banks’ credit outlooks to stable from negative and affirmed their international ratings at BBB+.

The banks are Arab National Bank (ANB), Banque Saudi Fransi (BSF), Alinma bank (Alinma), Saudi Investment Bank (SAIB), Bank Aljazira (BAJ) and Gulf International Bank - Saudi Arabia (GIB SA).

These ratings follow a similar action on Saudi Arabia’s sovereign rating on 15 July 2021 that was attributed to better fiscal management and an increase in oil prices.

“Fitch’s assessment considers the authorities’ strong ability to support the banking system, given large, albeit reduced from their historical levels, external reserves,” Fitch said in the statement.

“It also reflects a long record of support for Saudi banks, irrespective of their size, franchise, funding structure and level of government ownership.”


Saudi Arabia targets energy reduction worth $6.6bn by 2030, says CEO

Saudi Arabia targets energy reduction worth $6.6bn by 2030, says CEO
Updated 27 July 2021

Saudi Arabia targets energy reduction worth $6.6bn by 2030, says CEO

Saudi Arabia targets energy reduction worth $6.6bn by 2030, says CEO
  • Its services include retrofitting buildings and streetlighting and promotes the use of renewable energy, including rooftop solar PV

RIYADH: Saudi Arabia’s National Energy Services Company (Tarshid) said it plans to reduce energy consumption in the Kingdom by SR25 billion ($6.6 billion) by 2030.

“We are targeting integrated savings through the Saudi Energy Efficiency Program (SEEP), and in the public sector alone, we will be saving 8 terawatts and SR2.5 billion annually,” Tarshid CEO Waled Alghreri told CNBC Arabia in an interview.

Tarshid was established by the Public Investment Fund (PIF) to pioneer energy efficiency in Saudi Arabia in collaboration with the Ministry of Energy.

Its services include retrofitting buildings and streetlighting and promotes the use of renewable energy, including rooftop solar PV.

Its Energy Efficiency Program is a rare example of a country creating a dedicating, integrated initiative to target energy efficiency, said Alghreri.

Most such programs are scattered and decentralized and do not produce encouraging results, he said.


Amazon to rebrand Souq.com Egypt site this year

Amazon to rebrand Souq.com Egypt site this year
Updated 27 July 2021

Amazon to rebrand Souq.com Egypt site this year

Amazon to rebrand Souq.com Egypt site this year
  • Souq.com sellers in Egypt encouraged to set up on Amazon.eg

CAIRO: Amazon said it plans to rebrand the Egyptian version of Souq.com as Amazon.eg this year, following similar moves in Saudi Arabia and the UAE.

Sales partners previously registered on Amazon’s Souq.com affiliate can access their accounts through the Amazon Seller Center in preparation for selling their products on the Amazon Egypt website immediately after its launch.

Amazon acquired Middle East etailer Souq.com in 2017 from Syrian entrepreneur Ronaldo Mouchawar.

On May 1, 2019, Souq.com UAE became known as Amazon.ae. On June 17 last year, Amazon launched its dedicated Saudi website Amazon.sa, rebranding the old Souq.com website.

Amazon announced plans in March to hire 1,500 new employees in Saudi Arabia and add 11 buildings to its network. The expansion will boost storage capacity in the Kingdom by 89 percent and its geographical delivery network by 58 percent.

The company operates an extensive logistics network and local operations across Egypt, which includes the main warehouse supported by 15 delivery stations across the country.