Jamjoom plans Saudi expansion after UAE Subway deal

Jamjoom plans Saudi expansion after UAE Subway deal
The deal announced in the UAE will see a big increase in the number of outlets in the Emirates, as well as a major facelift for the chain. (Reuters)
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Updated 25 September 2021

Jamjoom plans Saudi expansion after UAE Subway deal

Jamjoom plans Saudi expansion after UAE Subway deal
  • “We have an ambitious plan to acquire markets and brands in Saudi Arabia" - KOJ group CEO

DUBAI: Kamal Osman Jamjoom Group, (KOJ), the Saudi group that last week announced a major expansion in the UAE via a master franchise deal with US fast-food group Subway, could follow that move with a big initiative in food and beverage in Saudi Arabia.

Hisham Al Amoudi, KOJ group chief executive, told Arab News: “We have an ambitious plan to acquire markets and brands in Saudi Arabia,” without identifying which brands. The move could take place next year, he said.

He cannot disclose the financial cost of the UAE expansion, but concedes it will be a “multi-million dirham initiative” to transform the stores with new training and uniforms for the staff, in addition to the stores’ facelift.

“Over the next 12 months, you will see a big difference,” he said.

Demographic synergy

Subway is run by a different franchise group in the Kingdom, but the attractions and synergies of fast F&B are apparent to KOJ, which operates big global outlets like Lego and Body Shop in addition to its own self-grown brands.

“The synergy lies in the demographic, the locations and the business model,” Al Amoudi said.

Each hour around the world, some 750,000 sandwiches or salads are sold by the ubiquitous Subway outlets, giving the brand fair claim to be the biggest restaurant chain globally.

The deal announced in the UAE will see a big increase in the number of outlets in the Emirates, as well as a major facelift for the chain.

“It is a huge opportunity going forward,” Al Amoudi said. “Subway is making bold and impressive changes to continue to grow its presence in markets around the world,” he added.

There are currently around 145 Subway stores in the UAE, but over the next few years that number will roughly double, and there will be a big change in the look and feel of the US-owned franchise under a refurbishment plan titled “Fresh Forward.”

Modern, minimalist

“The restaurants will look more neat and tidy, more modern, more minimalist, trying to avoid clutter and noise. They will have a new logo and color palette, and — above all — there will be a new emphasis on the taste of the food and the indulgence of the customer,” Al Amoudi said.

The Subway concept was born as a single sandwich store in Connecticut, USA, in the 1960s. Now, there are more than 40,000 stores in over 100 countries. Most are still in America, where it has more outlets than McDonalds and Starbucks combined.

It has formed partnerships with leading global franchise operators, like KOJ, to expand internationally.

“It is a global brand promising guests and customers consistent good experiences, and KOJ subscribed to that. We promise one voice, one message, one operating standard and one great experience,” Al Amoudi said.

Al Amoudi estimates that the total F&B business in the Emirates is worth some 62 billion dirhams, of which half comes from fast food, with the sandwich category accounting for 40 percent of that.

Known in the trade as the QSR model — quick service restaurants — Subway has a flexibility that allows it to adopt multiple store identities. The stores can range in size from 20 to 100 square meters, and can be located in malls, cinemas, high streets — “even inside embassies”, he said.

Subway is also big in the delivery space, which has been given a big boost during the lockdowns and social distancing of the COVID-19 pandemic.

Born in Jeddah

The UAE expansion could be a game-changer for KOJ, which has been operating since 1987 with offices in its Jeddah birthplace, as well as Dubai and Riyadh. In addition to Subway in the UAE, KOJ is one of the biggest franchise operators in Saudi Arabia, where most of its total 675 stores are located.

Al Amoudi sees big synergies between its existing brands and Subway.

In addition to Lego, Body Shop and Early Learning Center, KOJ also has its own unique brands, like the lingerie chain Nayomi, the biggest in the Middle East, as well as the Mikyajy chain of cosmetic stores.

In Saudi Arabia and elsewhere in the region, it also operates the Mihyar stores that cater to Gulf men with a range of traditional Arab clothing and accessories.

“We have been looking to diversify the group’s business activities, and F&B is a complementary activity. It targets the same profile. We serve the middle classes, we are not a mass or premium business, and Subway also serves the middle market,” Al Amoudi said.


Egypt to launch natural gas-powered bus fleet in 2022

Egypt to launch natural gas-powered bus fleet in 2022
Updated 05 December 2021

Egypt to launch natural gas-powered bus fleet in 2022

Egypt to launch natural gas-powered bus fleet in 2022

CAIRO: Egypt will launch its first fleet of buses powered by natural gas next year, Minister of Public Enterprise Hisham Tawfik has said.

About 70 percent of the components used in the manufacturing of the buses will be sourced locally, in cooperation with several Egyptian companies, he said.

Tawfiq said that the fleet will include buses that can accommodate 14 to 50 passengers, and that the goal of the project is to localize technology and transport production.

“Our strategy is to work in the production of environmentally friendly vehicles, whether they run on natural gas or electricity,” he added.

A delegation from the Belarusian Minsk Automobile Plant signed a contract to supply production materials for the project.

Production is expected to begin in mid-2022, with a target of 250 buses completed per year.

Tawfiq welcomed cooperation with the Belarusian side, especially in light of the distinguished relations between the two countries, which have developed significantly in recent years.


PIF offers 100m shares in stc in secondary public offering

PIF offers 100m shares in stc in secondary public offering
Updated 05 December 2021

PIF offers 100m shares in stc in secondary public offering

PIF offers 100m shares in stc in secondary public offering

RIYADH: Saudi Arabia’s Public Investment Fund (selling shareholder) and stc on Sunday announced the launch of a secondary public offering of stc’s ordinary shares, Argaam reported.

“The potential transaction is in line with the PIF’s strategy to recycle its capital to new investments,” the fund said in an earlier statement. 

A total of 10.02 million shares will be allocated to retail subscribers.

The offering comprises a fully marketed secondary public offering of 100.2 million stc shares, representing 5.01 percent of its share capital

The price range has been set between SR100 and SR116 per share. The final offer price will announced on Dec. 10.

Goldman Sachs Saudi Arabia, HSBC Saudi Arabia, Morgan Stanley Saudi Arabia and SNB Capital are acting as joint financial advisers for STC and joint global coordinators for STC and PIF. The Citigroup Saudi Arabia and Credit Suisse Saudi Arabia are acting as joint bookrunners, according to a bourse filing.


Bitcoin continues to decline from its high in November: Crypto wrap

Bitcoin continues to decline from its high in November: Crypto wrap
Updated 05 December 2021

Bitcoin continues to decline from its high in November: Crypto wrap

Bitcoin continues to decline from its high in November: Crypto wrap

RIYADH: Bitcoin, the leading cryptocurrency, plunged around 30 percent from the year’s high of $69,000 on Nov. 10.

It, however, traded higher on Sunday, rising by 2.82 percent to $48,972 at 5:14 p.m. Riyadh time.

Ether, the second most popular cryptocurrency, traded at $4,140 up 4.16 percent, according to data from CoinDesk.

“Corrections and declines do occur in almost all markets including crypto. The current decline is considered the largest in terms of market value since the late March 2020 decline,” Abdullah Mashat, managing director of a private Saudi retail company told Arab News.

Mashat said: “Current decline is due to investors being concerned of tapering talks in the US, which resulted in the decline in stock exchanges and later this caused liquidity crunch in the crypto markets."

Anto Paroian, COO at crypto hedge fund ARK36 said: “The market sentiments  have decisively soured as a result of deepening concerns about omicron variant and its (likely) effect on the economy. The current situation resembles closely what happened in March 2020 as we’re seeing equities plunge 5 percent off recent highs and the negativity is spreading to other markets as well including the digital asset markets. 

“On the other hand, the current price levels aren’t unexpected after the bulls failed to flip the $60,000 resistance multiple times in the past few weeks. During previous Bitcoin bull markets violent swings of 20-30 percent happened a few times before the market topped and let’s remember what happened in July - and how well the market rebounded afterward."

 "It must be noted, though, that one of the key Bitcoin bull market indicators — the 20-week simple moving average — has now been decisively breached so the outlook is currently bearish in the short to medium term. What’s more, since there are widespread expectations that interest rates will rise as central banks are signaling a more aggressive stance on inflation, the violent price move in the digital asset market may also suggest that some investors are preparing to go into a risk-off mode for the time being," Paroian added.

Meanwhile, El Salvador President Nayib Bukele said the Central American country had acquired an additional 150 bitcoins after the digital currency’s value slumped again, enlarging his bet on the cryptocurrency despite criticism.

Bukele said last week that El Salvador had acquired 100 additional coins to take advantage of the currency weakening.


Aramco enters Saudi lubricants market with new product line

Aramco enters Saudi lubricants market with new product line
Updated 05 December 2021

Aramco enters Saudi lubricants market with new product line

Aramco enters Saudi lubricants market with new product line

RIYADH: Saudi Aramco on Sunday announced its entry into the Kingdom’s domestic lubricants market with the launch of a new line of products.

The oil giant timed the ORIZON® launch to coincide with the inaugural Saudi Arabian Formula 1 Grand Prix in Jeddah.

The product line has been introduced in more than 20 cities including Riyadh, Jeddah and Dammam with more locations planned. The products include synthetic and semisynthetic lubricants for gasoline engines and heavy-duty diesel engines, as well as driveline products, greases and brake fluids. 

The company has also expanded the brand to include ORIZONPRO® which is a high-performance line for the industrial sector.

Yasser M. Mufti, Aramco vice president of fuels, said: “Entering the lubricants market is an important milestone for the company, as we continue to expand our presence throughout the downstream value chain.” 

The launch “further complements Aramco’s presence in the Kingdom’s downstream direct-to-consumer segment, following the inauguration of our first two service stations in Riyadh and Saihat recently.”


Countries tackle economic woes amid omicron fears, revised growth outlooks: Economic wrap

Countries tackle economic woes amid omicron fears, revised growth outlooks: Economic wrap
Updated 05 December 2021

Countries tackle economic woes amid omicron fears, revised growth outlooks: Economic wrap

Countries tackle economic woes amid omicron fears, revised growth outlooks: Economic wrap

CAIRO: The Australian government is expected to raise its economic growth forecast for 2022 in its midyear budget review, according to the country’s treasurer, Josh Frydenberg.

He said omicron’s effect, the new COVID-19 variant, is still unclear.

The country’s fiscal year runs until June.

The Australian economy narrowed by 1.9 percent in the third quarter of this year on the back of the delta variant which led to a national lockdown.

However, the treasurer said the country now enjoys one of the highest vaccination rates in the world, boosting market conditions.

France avoids more restrictions

France will try to refrain from the imposition of any health-related restrictions even as virus cases continue to rise, the country’s Finance Minister Bruno Le Maire said.

France is also avoiding any mandatory vaccination campaigns, Bloomberg reported, citing the minister.

He said two sectors, restaurants and hospitality, were particularly hit by the wave of new cases, adding that they will receive government support.

He also stated the new variant, omicron, is yet to have an effect on the country’s economic growth.

US growth rate

Unlike other countries, US expected growth rates for both 2021 and next year were trimmed down by Goldman Sachs, one of the world’s leading investment banks. 

It said this downward revision was attributed to a potential adverse effect by omicron, according to Bloomberg.

The world’s largest economy is now predicted to grow by 3.8 percent in 2021, instead of the previous 4.2 percent forecast. As for next year, the US is set to expand by 2.9 percent, down from 3.3 percent.

Meanwhile, the country’s unemployment rate plunged to a 21-month low to hit 4.2 percent in November, according to the Labor Department. This is a 2.1 percent drop compared to January’s level, a considerable decline.

However, employment growth slowed down during the month.

The economy is still expected to experience strong growth in the fourth quarter, following the previous quarter’s weak performance.