Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market

Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market
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Updated 29 June 2022

Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market

Arabian Drilling Co. gets approval to IPO 30% stake on Saudi stock market

RIYADH: Saudi-based Arabian Drilling Co. has received approval for an initial public offering of 26.7 million shares, representing 30 percent of the firm’s capital, on the Kingdom’s stock exchange.

The Capital Market Authority’s approval shall be valid for six months from the authority’s board resolution date. It shall be deemed cancelled if the company’s offering is not completed within this period. 


Gazprom ramps up gas flow to Hungary via Turkstream pipeline, official says

Gazprom ramps up gas flow to Hungary via Turkstream pipeline, official says
Updated 10 sec ago

Gazprom ramps up gas flow to Hungary via Turkstream pipeline, official says

Gazprom ramps up gas flow to Hungary via Turkstream pipeline, official says
  • The agreement with Gazprom is for 15 years, with an option to modify purchased quantities after 10 years

BUDAPEST: Russia’s Gazprom has ramped up flows to Hungary via the Turkstream pipeline that brings gas to Hungary via Serbia, a Hungarian Foreign Ministry official said on Saturday.

EU member Hungary has maintained what it calls pragmatic relations with Moscow since Russia’s invasion of Ukraine, creating tensions with some EU allies keen to take a tougher line.

Hungary, which is about 85 percent dependent on Russian gas, firmly opposes the idea of any EU sanctions on Russian gas imports and Prime Minister Viktor Orban has also lobbied hard to secure an exemption from EU sanctions on Russian crude oil imports.

Foreign Minister Peter Szijjarto met his Russian counterpart Sergei Lavrov in Moscow last month, seeking a further 700 million cubic meters of gas on top of an existing long-term supply deal with Russia.

Under a subsequent agreement, Gazprom started ramping up gas flows to Hungary on Friday, Hungarian Foreign Ministry State Secretary Tamas Menczer said in a statement.

Menczer said Gazprom would add 2.6 million cubic meters of additional gas per day to previously-agreed deliveries via Turkstream through August, with the amount of September deliveries being negotiated.

Hungary’s reserves stored 2.84 billion cubic meters of gas by the middle of July, the lowest level for that period over the past five years based on data by the national energy regulator.

Under a deal signed last year, before the start of the war in neighboring Ukraine, Hungary receives 3.5 billion cubic meters of gas per year via Bulgaria and Serbia under its long-term deal with Russia and a further 1 bcm via a pipeline from Austria.

The agreement with Gazprom is for 15 years, with an option to modify purchased quantities after 10 years.


DCO startup passport cuts the red tape on cross-border trade

DCO startup passport cuts the red tape on cross-border trade
Updated 13 August 2022

DCO startup passport cuts the red tape on cross-border trade

DCO startup passport cuts the red tape on cross-border trade
  • Program helps startups do business across borders more efficiently while maintaining their local footprint

RIYADH: The Digital Cooperation Organization, a global initiative focused on improving the digital economy, is working toward encouraging fledgling companies to tap international markets through its startup program.

Called Startup Passport, the program helps startups do business across borders more efficiently while maintaining their footprint in their country of origin, said Hassan Nasser, vice president of international affairs of DPO.

The program has opened up potentially lucrative markets with a combined population of over half a billion people and a combined gross domestic product of nearly SR7.5 trillion ($2 trillion), reported the Saudi Press Agency.

Hassan Nasser

“By creating a new market expansion in DCO countries and beyond, you will positively impact these other markets,” said Naseer.

He said that the expansion of startups would create new economic entities, improve employment within DCO member states and nurture innovative solutions.

By creating a new market expansion in DCO countries and beyond, you will positively impact these other markets.

Hassan Nasser

According to Nasser, these innovative solutions could find wider acceptance with most startups focusing on sustainability and conservation.

In fact, the DCO Global Roundtable Series at the World Telecommunication Development Conference in June was meant to bring together global leaders to advance digital prosperity.

Naseer explained that the roundtable provides a platform for leaders worldwide to exchange perspectives on improving cooperation in the digital space and delivering an inclusive, sustainable digital economy.

The first roundtable had around 35 participants from 20 different countries.

FASTFACT

$2tr

The program has opened up potentially lucrative markets with a combined population of over half-a-billion people and a combined gross domestic product of nearly SR7.5 trillion ($2 trillion).

In Nasser’s view, cross-border cooperation is one of the critical reasons for the existence of DCO. “That’s one of the reasons DCO exists, to help on that and drive this cross-border cooperation,” he said.

Developing an efficient model requires cooperation, reducing costs and increasing return on investment by defining the best solution.

“There are a lot of challenges when it comes to digital investment, digital skills, digital empowerment, where we need more cooperation,” Nasser said.

As Nasser explained, DCO does not compete with anything but addresses a gap and complements a need.

The DCO will deliver its future roundtables in Latin America, Europe, Asia, and the United Nations General Assembly in New York.

Commenting on the UN General Assembly, he said it “will be a place where we get a global audience for this important session.”

He added: “A vital component of the organization’s mission is launching initiatives that will benefit all member states.”

With 11 member nations, DCO aspires to bring inclusive growth in the digital economy across its member nations, such as Bahrain, Djibouti, Jordan, Kuwait, Morocco, Nigeria, Oman, Pakistan, Rwanda, Saudi Arabia, and Cyprus.

The organization was launched in early 2022 at LEAP, a global event for future technologies held in Riyadh.


Acciona rejects carbon-intensive projects to meet environmental commitments

Acciona rejects carbon-intensive projects to meet environmental commitments
Updated 13 August 2022

Acciona rejects carbon-intensive projects to meet environmental commitments

Acciona rejects carbon-intensive projects to meet environmental commitments
  • The company is bidding for NEOM in the heavy civil area with hopes of contributing to the Kingdom’s projects

DUBAI: Spain's Acciona, a leader in sustainable solutions for infrastructure and renewable energy, has been rejecting projects that are not carbon neutral as part of its commitment to environmental protection.

According to a top executive, the company has been turning down projects directly involved in oil and gas extraction or production since they will add to the carbon dioxide emissions on its balance sheet.

Founded in 1931, the company has been carbon neutral since 2016, said Acciona's Middle East Director-General Jesus Sancho while speaking to Arab News.

Jesus Sancho

"That's something easy to say, but it is very difficult to achieve for a company which is present across 60 countries in the world," he said.

That’s something easy to say, but it is very difficult to achieve for a company which is present across 60 countries in the world.

Jesus Sancho

Sancho explained that one part of the company invests solely in renewable energy to achieve carbon neutrality. Acciona owns and operates its assets, including more than 12 gigawatts of renewable energy, contributing to negative carbon emissions.

As for renewable energies, the company has solar thermal, photovoltaic, concentrating solar-thermal power and wind farms, all of which are carbon-negative and offset the carbon dioxide generated by the other areas of the company, he added.

The challenge for Acciona, which has invested approximately SR1.8 billion ($500 million) in projects, is minimizing each project's carbon footprint to achieve carbon neutrality.

FASTFACT

$500m

The challenge for Acciona, which has invested approximately SR1.8 billion ($500 million) in projects, is minimizing each project’s carbon footprint to achieve carbon neutrality.

"We are focusing on projects aligned with our philosophy," he said, adding that his company's sustainability master plans were well aligned with Saudi Arabia's Vision 2030's goals.

The company's sustainability commitment has already invited the attention of the futuristic smart city, NEOM.

Acciona, according to Sancho, is bidding for NEOM in the heavy civil area with hopes of contributing to the Kingdom's projects.

The company is currently working on water treatment plant projects in the Kingdom. It has also set up desalination plants in Alkhobar 1, Alkhobar 2 and Shuqaiq 4.

Acciona also built the Shuqaiq 3 desalination plant to full capacity, producing 450 million liters of potable water daily. In addition, the plant is equipped with energy-efficient seawater reverse osmosis technology.

 


Five Chinese state-owned companies to delist from NYSE amid US tensions

Five Chinese state-owned companies to delist from NYSE amid US tensions
Updated 12 August 2022

Five Chinese state-owned companies to delist from NYSE amid US tensions

Five Chinese state-owned companies to delist from NYSE amid US tensions

SHANGHAI: Five Chinese state-owned companies, including oil giant Sinopec and China Life Insurance, said on Friday they would delist from the New York Stock Exchange, amid economic and diplomatic tensions with the US, according to Reuters.

The companies, which also include Aluminium Corporation of China, PetroChina and Sinopec Shanghai Petrochemical Co, each said that they would apply to delist their American Depository Shares this month.

The five, which in May were flagged by the US securities regulator as failing to meet its auditing standards, will keep their listings in Hong Kong and mainland Chinese markets.

Beijing and Washington are in talks to resolve a long-running audit dispute that could see Chinese companies banned from US exchanges if they do not comply with US rules.

Washington has long demanded complete access to the books of US-listed Chinese companies, but Beijing bars foreign inspection of audit documents from local accounting firms, citing national security concerns.

There was no mention of the auditing dispute in separate statements by the Chinese companies outlining their moves, which come amid heightened tensions after last week’s visit to Taiwan by US House of Representatives Speaker Nancy Pelosi.

“These companies have strictly complied with the rules and regulatory requirements of the US capital market since their listing in the US and made the delisting choice for their own business considerations,” the China Securities Regulatory Commission said in a statement.

The agency added that it would keep “communication open with relevant overseas regulatory agencies.”

The oversight row, which has been simmering for more than a decade, came to a head in December when the Securities and Exchange Commission finalized rules to potentially prohibit trading in Chinese companies under the Holding Foreign Companies Accountable Act. It said 273 companies were at risk.

Some of China’s largest companies including Alibaba Group Holdings, J.D Com Inc. and Baidu Inc. are among them. Alibaba said last week it would convert its Hong Kong secondary listing into a dual primary listing which analysts said could ease the way for the Chinese ecommerce giant to switch primary listing venues in the future.

In premarket trading Friday, US-listed shares of China Life Insurance and oil giant Sinopec fell 5.7 percent about 4.3 percent respectively. Aluminium Corporation of China dropped 1.7 percent, while PetroChina shed 4.3 percent. Sinopec Shanghai Petrochemical Co. shed 4.1 percent.

A spokesperson for NYSE declined to comment. A spokesperson for the Public Company Accounting Oversight Board, the audit watchdog overseen by the SEC, did not immediately provide comment.

Losing Patience? 

Market-watchers were split over what the delistings might mean for the audit deal, with some saying it was a bad sign.

“China is sending a message that its patience is wearing thin in the audit talks,” said Kai Zhan, senior counsel at Chinese law firm Yuanda, who specializes in US capital markets.

The companies said their US traded share volume was small compared with those on their other major listing venues.

PetroChina said it had never raised follow-on capital from its USlisting and its Hong Kong and Shanghai bases “can satisfy the company’s fundraising requirements” as well as providing “better protection of the interests of the investors.”

Global fund managers holding US-listed Chinese stocks are steadily shifting toward their Hong Kong-traded peers, even as they remain hopeful the audit dispute will eventually be resolved, Reuters reported this week.

“These companies are very thinly traded with very small US market cap so it is not a loss for US capital markets,” Brendan Ahern, CIO of Krane Funds Advisers, which has a New York-listed fund focused on Chinese tech plays, wrote in an email.

He and analysts said the delistings could pave the way for China to comply with the US requirements, since the five companies concerned likely have sensitive information China would not want exposed in an audit review.

“We see this as a positive sign. This is consistent with our view China will decide what companies would be allowed to be US-listed and thus subject to SEC’s audit investigations,” Jefferies analysts wrote in a note.

China Life and Chalco said they would file for delisting on Aug. 22, with it taking effect 10 days later. Sinopec, whose full name is China Petroleum & Chemical Corporation, and PetroChina said their applications would be made on Aug. 29.

China Telecom, China Mobile and China Unicom were delisted from the US in 2021 after a Trump-era decision to restrict investment in Chinese technology firms.

That ruling has been left unchanged by the Biden administration amid continuing tensions. 


US Stocks — Futures up as easing price pressures set Wall St. for weekly gains

US Stocks — Futures up as easing price pressures set Wall St. for weekly gains
Updated 12 August 2022

US Stocks — Futures up as easing price pressures set Wall St. for weekly gains

US Stocks — Futures up as easing price pressures set Wall St. for weekly gains

BENGALURU: US stock index futures rose on Friday, setting the S&P 500 and the Nasdaq for a fourth straight week of gains on easing bets of another super-sized interest rate hike by the Federal Reserve.

The S&P 500 is up 15 percent from mid-June, with the latest boost coming from a slower-than-expected rise in consumer prices and a surprise drop in producer prices in July.

The benchmark index is within sight of a 50 percent retracement of its bear market loss and investors are watching the 4,231 level. The index last closed at 4,207.27.

While policymakers remain firm about a further tightening in monetary policy until inflation pressures fully abate, traders see a 63.5 percent chance of the Fed raising rates by 50 basis points next month instead of a 75 basis points hike.

The Fed has raised its policy rate by 225 basis points since March as it battles to cool demand without sparking a sharp rise in layoffs.

High-growth and technology stocks such as Tesla and Nvidia rose 1 percent each in trading before the bell as investors flocked back to riskier assets.

Growth stocks have underpeformed their value counterparts so far this year on worries that rising Treasury yields due to aggressive rate hikes will pressure their valuation.

Investors bought $7.1 billion in equities in the week to Wednesday, according to a Bank of America note, with US growth stocks recording their largest weekly inflow since December last year.

Meanwhile, banks looked set to extend their rally for sixth straight week, with JPMorgan Chase & Co. and Goldman Sachs gaining 0.4 percent each in premarket trading.

At 07:28 a.m. ET, Dow e-minis were up 106 points, or 0.32 percent, S&P 500 e-minis were up 13.75 points, or 0.33 percent, and Nasdaq 100 e-minis were up 42 points, or 0.32 percent.

Rivian Automotive Inc. slipped 0.2 percent even as the electric-vehicle maker reported better-than-expected second quarter revenue.

The University of Michigan’s preliminary survey of consumer sentiment for August is expected at 10:00 am ET.