Saudi markets surge as M&A activity set to continue until mid-2022: General Authority for Competition

Saudi markets surge as M&A activity set to continue until mid-2022: General Authority for Competition
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Updated 21 October 2021

Saudi markets surge as M&A activity set to continue until mid-2022: General Authority for Competition

Saudi markets surge as M&A activity set to continue until mid-2022: General Authority for Competition

RIYADH: The Saudi market saw mergers and acquisitions jump 68 percent to 237 applications in the first nine months of 2021 — led by the IT, healthcare and petrochemical sectors according to a Saudi expert.

Talal Alhogail, head of mergers and acquisitions at the General Authority for Competition,  said the year-on-year comparison shows that it has been an exceptional period for business as it recovers from the pandemic, reported Asharq.

He added he expects the high rate to continue into the middle of 2022.

In August, the authority approved the merger of 32 companies and local exchange institutions (purchasing and selling foreign currencies).

It was one of the largest merger operations in terms of the number of establishments involved in a single deal in its history.

The year also saw the merger of National Commercial Bank and Samba Financial Group under the name of Saudi National Bank. 

With SR837 billion ($223 billion) in assets, SNB will be Saudi Arabia’s largest bank, accounting for a market share of 25 percent across all metrics. It will be well capitalized with a combined equity of SR120 billion.

The combination of the country’s largest with its fourth-largest lender creates a national champion across the board.


SISCO’s subsidiary LogiPoint acquires Elite Group

SISCO’s subsidiary LogiPoint acquires Elite Group
sisco.com
Updated 12 sec ago

SISCO’s subsidiary LogiPoint acquires Elite Group

SISCO’s subsidiary LogiPoint acquires Elite Group
  • The transaction is to be funded through bank financing and direct cash investment

Saudi Trade and Export Development Co. (LogiPoint) has acquired Elite Group through Green Dome Investments LLC, according to a bourse filing by its parent Saudi Industrial Services Co. 

The transaction was concluded on Nov. 25, with LogiPoint’s investment in Green Dome valued at SR58 million ($15 million).

SISCO expects the impact of the transaction to be shown in the consolidated financial statements of the fourth quarter of 2021, through LogiPoint.

The transaction is to be funded through bank financing and direct cash investment. 

Elite Group is an integrated land freight and courier solutions provider in the region. 


Bahrain outlook improves on fiscal reforms, S&P says

Bahrain outlook improves on fiscal reforms, S&P says
Image: Shutterstock
Updated 39 min 17 sec ago

Bahrain outlook improves on fiscal reforms, S&P says

Bahrain outlook improves on fiscal reforms, S&P says
  • The agency said it expects the government to benefit from additional financial support from its Gulf neighbours

S&P Global Ratings has revised Bahrain's outlook to 'stable' from 'negative' on the back of new fiscal reforms aimed at improving non-oil revenues and cutting state spending, the ratings agency said in a statement.

Rated below investment grade, Bahrain was bailed out to avoid a credit crunch in 2018 with a $10 billion package from wealthy neighbours, Saudi Arabia, Kuwait and the United Arab Emirates.


That money was linked to a set of fiscal reforms, but after the coronavirus crisis strained its finances, Bahrain in September postponed plans to balance its budget by two years and announced plans to increase a value-added tax.


"The Bahraini government recently announced additional fiscal reforms to strengthen non-oil revenue and rationalize expenditure. These measures, along with the more supportive oil price environment, should improve the sovereign's fiscal position", S&P said in a statement this weekend.


The agency said it expects the government to benefit from additional financial support from its Gulf neighbors, if needed.


Bahrain will double value-added tax to 10 percent next year, a move which S&P estimated could contribute receipts of about 3 percent of gross domestic product in the next few years, up from about 1.7 percent this year.


The Gulf state is also planning to rationalize operational government expenditure and social subsidies in 2023 and 2024, a move which shifts the focus of its reforms more on the spending side than on raising non-oil revenues.


"We believe there is higher implementation risk in expenditure rationalization as the delicate political and social environment on the island, which has constrained the government's efforts, persists", S&P said.


Bahrain has in the past backtracked on some reforms as its Sunni Muslim rulers feared that austerity moves would bolster the majority Shi’ite-led opposition and stir more of the unrest that rattled the country since the 2011 Arab Spring uprisings.


How Omicron is affecting Middle East markets

How Omicron is affecting Middle East markets
Image: Shutterstock
Updated 53 min 16 sec ago

How Omicron is affecting Middle East markets

How Omicron is affecting Middle East markets
  • Oil prices stumbled in their biggest decline since April 2020

DUBAI: The new COVID-19 variant, Omicron, has prompted global economic concerns, as fears of its spread begin to affect stock markets and oil prices. 

Saudi Arabia’s main market, the Tadawul All Share Index, opened 5.3 percent lower on Sunday, trading near 10,700 points. 

The Dubai Financial Market was down 8.49 percent.

Oil prices stumbled in their biggest decline since April 2020, with Brent prices dropping 11.55 percent to $72.72 per barrel when markets closed on Friday, while WTI slid 13.06 percent down to $68.15 per barrel.

The variant was first discovered in South Africa and had also since been detected in Belgium, Botswana, Israel, the UK, Australia and Hong Kong.

Within the Middle East Israel is the only country to have reported a case of the new variant so far, but some governments in the region have issued travel curbs to prevent the virus from spreading. 

On Sunday, Saudi Arabia expanded the list of African countries where it barred travel because of Omicron, adding Malawi, Zambia, Madagascar, Angola, Seychelles, Mauritius and the Comoros Islands.

The Kingdom earlier halted flights to and from South Africa, Namibia, Botswana, Zimbabwe, Mozambique, Lesotho and Eswatini.

Other Middle East countries, including the UAE, Bahrain, Morocco, and Jordan have issued similar measures. 


Saudi stock market drops 5.3 as Omicron sparks global concern

Saudi stock market drops 5.3 as Omicron sparks global concern
Updated 53 min 1 sec ago

Saudi stock market drops 5.3 as Omicron sparks global concern

Saudi stock market drops 5.3 as Omicron sparks global concern

Saudi Arabia’s main market, the Tadawul All Share Index, opened 5.3 percent lower on Sunday, trading near 10,700 points.


Aramco prepares work on its largest non-associated gas field

Aramco prepares work on its largest non-associated gas field
Updated 28 November 2021

Aramco prepares work on its largest non-associated gas field

Aramco prepares work on its largest non-associated gas field
  • The Saudi-listed firm claims it to be the “largest non-associated gas field” in the Kingdom

DUBAI: Saudi Arabia’s oil giant Aramco is marking the start of its development of the Jafurah unconventional gas field on Nov. 29. 

The Saudi-listed firm claims it to be the “largest non-associated gas field” in the Kingdom. 

The move is part of the Kingdom’s push to commercialize its unconventional resources and expand Aramco’s integrated gas portfolio.