PIF expands global asset management partnerships with multiple deals

Update PIF expands global asset management partnerships with multiple deals
In a statement, PIF announced that upcoming FII events will feature its Asset Management Forum as a central component, elevating discussions and insights on both local and global stages. Shutterstock
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Updated 31 October 2024
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PIF expands global asset management partnerships with multiple deals

PIF expands global asset management partnerships with multiple deals

RIYADH: Saudi Arabia’s wealth fund signed multiple memorandums of understanding with top international institutions at the eighth Future Investment Initiative in Riyadh, reinforcing its commitment to advancing the Kingdom’s asset management sector. 

The Public Investment Fund Asset Management Forum was also featured as a central platform at the event, drawing over 300 industry leaders, government representatives, and fund managers.

MoU with FII Institute

Through an MoU with the Future Investment Initiative Institute, PIF established a partnership to make the Asset Management Forum a key feature of future FII events.

This move is intended to bring critical discussions about Saudi Arabia’s asset management sector to the forefront on both local and global stages. 

Key topics addressed at the forum included the evolution of Saudi capital markets, the role of artificial intelligence in portfolio management, and the development of emerging local asset managers.  

The forum also celebrated the graduation of the inaugural class from PIF’s Portfolio Management Development Program, aimed at upskilling talent to meet the growing demands of the industry.

Abdulmajeed Al-Hagbani, head of securities investments at PIF, said: “Strong and dynamic capital markets are an integral part of financing Saudi Arabia’s ambitious economic growth plans.”

He added: “PIF is committed to driving innovation and diversifying the range of investment products and initiatives to reshape the capital market.”

Deals with Japanese institutions

PIF signed agreements valued at up to $51 billion with five leading Japanese financial institutions, namely Mizuho Bank, Sumitomo Mitsui Financial Group, and MUFG Bank, as well as Japan Bank for International Cooperation and Nippon Export and Investment Insurance.  

These agreements are designed to strengthen financial collaboration, facilitating two-way capital flows through debt and equity investments. This reflects PIF’s strategy to enhance global financial connectivity and encourage mutual growth opportunities in finance, investment, and sustainable development.

Partnership with Hong Kong Monetary Authority 

In a significant step to reinforce economic ties, PIF also signed an MoU with the Hong Kong Monetary Authority to establish a $1 billion investment fund. 

The fund, targeting companies with connections to Hong Kong and Saudi Arabia, will focus on manufacturing, renewables, fintech, and healthcare sectors.  

This partnership aligns with Saudi Vision 2030 by supporting the localization of industries within the Kingdom, promoting highly skilled job creation, and enabling Saudi access to Hong Kong’s deep financial resources and industry expertise.

Collaborations with Brookfield, State Street, and Mizuho 

Further expanding its international partnerships, PIF signed agreements with Brookfield Asset Management, State Street Saudi Arabia Financial Solutions, and Mizuho Financial Group. 

The MoU with Brookfield establishes the Brookfield Middle East Partners platform, a private equity vehicle dedicated to investments in the Kingdom and the broader region. 

Agreements with State Street and Mizuho will see the development of new investment products that enhance Saudi Arabia’s position in the global asset management sector.  

These collaborations represented a concerted effort by PIF to introduce diversified investment opportunities and bring innovative products to the Saudi market. 

The collected agreements are part of PIF’s broader strategy to position the Kingdom as a global asset management hub, reinforcing the nation’s standing in international capital markets and attracting foreign expertise to support sustainable economic growth.


Closing Bell: Saudi main index closes in green at 12,093

Closing Bell: Saudi main index closes in green at 12,093
Updated 06 November 2024
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Closing Bell: Saudi main index closes in green at 12,093

Closing Bell: Saudi main index closes in green at 12,093

RIYADH: Saudi Arabia’s Tadawul All Share Index gained 78.41 points or 0.65 percent to close at 12,093.35 on Wednesday. 

The total trading turnover of the benchmark index was SR7.57 billion ($2.02 billion), with 168 of the listed stocks advancing and 60 declining. 

The Kingdom’s parallel market Nomu also gained 22.06 points to close at 28,853.64, while the MSCI Tadawul Index edged up by 11.93 points to 1,519.76.

The best-performing stocks on the benchmark index were Al-Baha Investment and Development Co. and Tourism Enterprise Co., whose share prices surged by 10 percent and 6.32 percent, to SR0.33 and SR1.01, respectively. 

The worst performer of the day was Almunajem Foods Co. The firm’s share price edged down by 7.81 percent to SR106.20.

On the announcements front, Arabian Drilling Co. reported a net profit of SR251.24 million in the first nine months of this year, representing a 40.06 percent decline compared to the same period in 2023. 

In a Tadawul statement, the company attributed this net income decline to higher net finance expenses, as well as depreciation and amortization costs. Despite the net profit drop, Arabian Drilling Co.’s share prices did not change on Wednesday and remained at SR111.60.

Saudi Arabian Mining Co., also known as Ma’aden, announced that its net profit for the first nine months of this year reached SR2.97 billion, compared to a net loss of SR83.43 million in the same period in 2023. 

In a Tadawul statement, the mining firm attributed the rise in profit to higher sales prices and volumes, as well as lower depreciation expenses.

Maaden's share price edged up 4.07 percent to SR56.20.

Saudi Electricity Co. announced that its net profit for the first nine months of this year, after deducting the payments of the Mudaraba coupon, reached SR5.58 billion, marking a 21.3 percent rise compared to the same period in the previous year. 

SEC’s nine-month profit rose to SR12.1 billion before Mudaraba coupon payments, up from SR10.3 billion in the same period last year.

SEC’s share price surged by 6.28 percent to SR17.26 on Wednesday.

Saudi Industrial Development Co., which also announced its earnings report, said that it narrowed its net loss to SR20.07 million in the first nine months of this year, compared to a net loss of SR21.8 million in the year-ago period. 

SIDC’s share price edged down by 0.71 percent to SR27.90. 

Saudi Ground Services Co. reported a net profit of SR231.27 million in the first nine months of this year, representing a 54.33 percent year-on-year rise. 

In a Tadawul statement, the company attributed this rise in net profit to an increase in both domestic and international flight operations, especially during the Hajj and Umrah seasons. 

The share price of SGS did not witness any change on Wednesday, and the company closed the trading session at SR52.20.


Saudi real estate to see $48bn in deals at Cityscape Global 2024

Saudi real estate to see $48bn in deals at Cityscape Global 2024
Updated 06 November 2024
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Saudi real estate to see $48bn in deals at Cityscape Global 2024

Saudi real estate to see $48bn in deals at Cityscape Global 2024

JEDDAH: Saudi Arabia’s real estate sector is poised for another major boost with an estimated SR180 billion ($48 billion) in deals expected to be signed at Cityscape Global 2024, taking place in Riyadh from Nov. 11-14.

The event will feature a global investment forum with representatives from 22 countries managing over $3.2 trillion in assets, further solidifying Riyadh’s position as a key capital hub.

Over 30,000 housing units from international developers will also be launched, marking a significant entry into the Saudi market.

Cityscape Global 2024, hosted at Riyadh’s Exhibition and Convention Center in Malham, stands as a major platform for innovation and growth. It underscores Saudi Arabia’s ongoing evolution in real estate, driven by Vision 2030, and its commitment to sustainable development in this vital sector.

The event will host nearly 200 international companies from 50 countries, along with 104 local developers and over 70 global real estate investors. This diverse representation will create a unique platform for shaping the future of real estate in the Kingdom. This year’s edition will span a remarkable 120,000 sq. meters — double the size of the previous edition.

Unprecedented growth

The Saudi real estate sector has seen exceptional growth, with local developers increasing from 48 to 104 in just one year and international developers rising from 54 to 69. This expansion is reflected in the sector’s performance in 2024, with over 280,000 real estate transactions worth more than SR636 billion.

According to the 2024 Global Real Estate Transparency Index, Saudi Arabia’s market ranks among the world’s most improved, raising expectations for Cityscape 2024 and attracting more attention to the Kingdom’s burgeoning real estate opportunities.

Championing the growth

Much of this progress is driven by Saudi Arabia’s Minister of Municipalities and Housing Majid Al-Hogail who has been instrumental in strengthening the sector’s regulatory framework.

Under his leadership, the real estate sector now contributes over 12 percent to Saudi Arabia’s non-oil gross domestic product.

Al-Hogail’s vision includes promoting sustainable urban development, enhancing homeownership rates, and creating smart cities through transformative projects like NEOM and The Line.

Cityscape’s role

Cityscape Global 2024 will showcase Saudi Arabia’s real estate advancements, offering an immersive experience for participants. A holographic map of future cities will allow attendees to explore designs, buildings, and street layouts that represent the Kingdom’s vision for sustainable urban development.

With Al-Hogail’s leadership, Cityscape 2024 is poised to pave the way for an innovative and sustainable real estate future in Saudi Arabia.

A global real estate leader

Cityscape Global 2024 is more than just an event; it is a testament to Saudi Arabia’s rapid development and commitment to excellence. As the Kingdom positions itself as a global leader in real estate, Cityscape will drive the sector to new heights, aligned with the country’s Vision 2030 and its pursuit of creating thriving, sustainable communities.


Saudi Aramco slashes December oil prices for Asian buyers

Saudi Aramco slashes December oil prices for Asian buyers
Updated 06 November 2024
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Saudi Aramco slashes December oil prices for Asian buyers

Saudi Aramco slashes December oil prices for Asian buyers

RIYADH: Saudi Aramco has reduced its December pricing for Arab Light crude oil for Asian buyers, according to the latest price list released by the state-owned oil giant. The official selling price for Arab Light crude was cut by 50 cents, bringing it to $1.70 per barrel above the regional benchmark.

Similarly, the OSPs for Arab Extra Light and Super Light grades were also reduced by 50 cents per barrel for December, while the OSPs for Arab Medium and Heavy grades saw smaller cuts of 40 cents per barrel.

For North America, Aramco set the December OSP for its flagship Arab Light crude at $3.80 per barrel above the Argus Sour Crude Index. The price differential for Arab Light crude in Western Europe was set at $0.15 above the ICE Brent benchmark, according to an official statement.

Aramco produces five grades of crude oil: Super Light, Arab Light, Arab Extra Light, Arab Medium, and Arab Heavy.

These grades are distinguished by their density: Super Light has a density of more than 40, Arab Extra Light ranges between 36 and 40, Arab Light between 32 and 36, Arab Medium between 29 and 32, and Arab Heavy has a density of less than 29.

The global oil market has been under pressure in recent days, with crude oil prices falling 2.5 percent on Wednesday, ending a five-day winning streak.

This decline was largely attributed to a stronger US dollar, as early reports suggested that Donald Trump is edging closer to securing a second term in the White House. A stronger dollar tends to exert downward pressure on oil and other commodities, making them more expensive for buyers using other currencies.

As a result, Brent crude oil futures dropped to $73.64 per barrel, marking a 2.5 percent decrease from the previous close of $75.53. Similarly, West Texas Intermediate crude futures fell to around $70.22 per barrel, down 2.45 percent from the prior close of $71.99.

Crude oil prices have been subject to significant fluctuations recently, influenced by several key factors. These include OPEC+’s decision to delay its December production plans for the second time, rising tensions in the Middle East, expectations surrounding the upcoming US Federal Reserve policy meeting, and early signs of economic improvement in China, the world’s largest crude importer.


Saudi Tadawul Group eyes M&As to strengthen capital markets: Bloomberg

Saudi Tadawul Group eyes M&As to strengthen capital markets: Bloomberg
Updated 06 November 2024
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Saudi Tadawul Group eyes M&As to strengthen capital markets: Bloomberg

Saudi Tadawul Group eyes M&As to strengthen capital markets: Bloomberg

RIYADH: Saudi stock exchange operator Tadawul Group is ramping up plans for mergers and acquisitions to expand the Kingdom’s capital markets amidst a wave of local listings, a senior executive said.

In an interview with Bloomberg in London, Chief Strategy Officer at Saudi Tadawul Group Lee Hodgkinson highlighted that the firm is targeting “digestible” and “strategically relevant acquisitions,” though he did not elaborate on specific targets.

“Mergers and acquisitions will be more integral to our future strategy than in the past,” Hodgkinson said.

The Saudi bourse has seen an influx of companies listing in recent years. This aligns with the Kingdom’s Vision 2030 initiative led by Crown Prince Mohammed bin Salman, which aims to deepen capital markets and reduce reliance on oil.

This year alone, stock sales on Tadawul have raised $15.6 billion, including a significant offering from energy giant Saudi Aramco, Bloomberg reported.

While Hodgkinson did not dismiss potential acquisitions of other stock exchanges down the line, he emphasized that Tadawul’s immediate focus is on diversifying its revenue streams.

Earlier this year, the firm acquired a stake in the Dubai Mercantile Exchange’s parent company for $28.5 million, marking a strategic move into the commodities market.

Looking ahead, Tadawul is exploring various post-trade services, including stock lending and collateral management, alongside developing data services like market indices.

According to Hodgkinson, the team will “exercise a great deal of discipline” on value and possible synergies while evaluating purchase possibilities. He added that M&A activity is intended to support the group’s organic growth strategy.

In August, Bloomberg reported that the Saudi Tadawul Group is intensifying its focus on attracting Asian investors to boost liquidity and trading activity in the region’s largest market.

This push comes as foreign ownership in Saudi capital markets has grown significantly, reaching SR401 billion by the end of 2023, a record high.

Net foreign investments rose by 7.7 percent from the previous year to SR198 billion ($52.77 billion), highlighting the success of the Qualified Foreign Investor program, first introduced in 2015 to open up the Saudi market to global backers.

According to Bloomberg, the Tadawul Group has identified Asia as a key area of focus, aiming to strengthen ties with major Asian markets to diversify the Kingdom’s investment sources.

In the interview, Hodgkinson highlighted that the group sees immense investment potential from markets like China and India.

Tadawul also plans to expand beyond equities into debt markets, commodities, and advanced post-trading services to position itself as a competitive international market player.

Increased mergers, acquisitions, and partnerships are anticipated as the company pursues these goals.


Biban 24 sees deals worth over $4.79bn on opening day

Biban 24 sees deals worth over $4.79bn on opening day
Updated 06 November 2024
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Biban 24 sees deals worth over $4.79bn on opening day

Biban 24 sees deals worth over $4.79bn on opening day

RIYADH: On the first day of Biban 24, a total of 17 agreements and memorandums of understanding were signed, alongside the launch of financial initiatives valued at more than SR18 billion ($4.79 billion).  

These deals and financing portfolios were finalized during the Riyadh event, organized by the General Authority for Small and Medium Enterprises under the theme “A Global Destination for Opportunities.”  

The forum aims to empower small and medium enterprises and entrepreneurs by enhancing their access to financial support, ultimately fostering growth in this vital sector of the national economy, as reported by the Saudi Press Agency.  

Monsha’at secured cooperation agreements with several leading local financial institutions, including Riyad Bank, which committed to a financing portfolio worth SR3 billion; Al-Rajhi Bank, with SR2.9 billion; and Bank Albilad, offering SR2.85 billion. Additional agreements were signed with Bank AlJazira for SR1 billion, Alinma Bank for SR800 million, and Banque Saudi Fransi for SR700 million. 

A deal worth SR25 million was inked with Abdul Latif Jameel Co. 

These efforts align with Monsha’at’s ongoing mission to strengthen the growth and competitiveness of SMEs by partnering with key players from various sectors, both locally and internationally.  

The overarching goal is to create a conducive environment for growth and build a leading society. As of 2023, SMEs in Saudi Arabia accounted for 28.7 percent of the country’s total gross domestic product, reflecting an 8.7 percent increase from previous figures, and on target for the Vision 2030 target of 35 percent, according to data from Statista.  

Several other announcements were made on the first day in the realm of financing and expanding support for projects. 

The Saudi National Bank unveiled a financing portfolio of SR3 billion, while Saudi Awwal Bank announced a similiar initiative valued at SR1 billion. The Arab National Bank also announced an SR1.1 billion financing portfolio, along with the launch of an e-commerce financing product worth SR500 million.  

Additionally, the Small and Medium Enterprises Bank revealed that it would allocate SR1 billion to finance SMEs in the fourth quarter of 2024.

This funding will be distributed through approved financing models in collaboration with various partner institutions. The bank also introduced a dedicated financing program for SMEs in the education sector, which was developed in partnership with the Ministry of Education and commercial banks.

Monsha’at also concluded several local and international agreements, including an MoU with the Korean Ministry of Small and Medium Enterprises and Korean startups to cooperate in the field of technical classification of SMEs, mainly in the financial technology sector.

Additionally, the program will support innovative projects in cooperation with major companies from both countries. This contributes to the exchange of knowledge and technology between the two sides.

The authority also signed an agreement with the Korean Franchise Association with the goal of facilitating the exchange of 50 brands between the two countries and providing the necessary support for the success of these brands in new markets. 

The Korean Minister of Startups and Small and Medium Enterprises, Oh Youngju, said innovation knows no borders and that startups are shaping the world’s landscape, addressing the significant expansion of technology worldwide. 

During her participation, she explained that 18 percent of venture capital funding was directed toward artificial intelligence, marking a significant technological shift. She underlined that European startups are leading this change by integrating generative AI into their operations.

The forum further witnessed the signing of a memorandum of cooperation between Monsha’at and SME Corporation Malaysia. The agreement aims to facilitate market access through various programs and services, promote knowledge exchange in innovation and entrepreneurship, and enable the sharing of franchise brands between the two parties.

A memorandum of cooperation was also signed with the Malaysian Franchise Development Co., also known as Bernas, to provide training programs and advisory services, participate in franchise exhibitions between the two countries, and exchange expertise related to studies and mechanisms.

The authority also collaborated with X Development to provide specialized training programs and innovative digital transformation solutions. Through this partnership, Monsha’at aims to equip entrepreneurs and SMEs with essential digital skills and knowledge to enhance their market competitiveness and adapt to rapid changes in the business landscape.

In terms of cooperation with Europe, the authority sealed an additional memorandum of cooperation with the Estonian Business and Innovation Agency to design three specialized educational programs in innovation and entrepreneurship.

This initiative focuses on high school and university students alongside training programs designed to enhance skills and competencies, contributing to accelerating the growth of emerging companies.

With regards to the Arab world, Monsha’at signed an MoU with Bahrain’s Labor Fund or Tamkeen.

The agreement aims to bolster economic, trade, and investment cooperation in the SME sector across both countries. This initiative will focus on collaboration in the Franchise Program, including facilitating the exchange of franchise brands for local and international expansion and fostering talent development and capacity building.

To further enhance investment opportunities, Monsha’at announced 10,000 investment opportunities in cooperation with the “Invest in Saudi” and “Forsa” platforms, in addition to partner entities like the National Center for the Non-Profit Sector and the “Nine Tenths” platform.

The opening day of the forum also saw the announcement that the Kingdom would host the finals of the Middle East and North Africa Startup Competition for the first time — in collaboration with the London Business School. The competition specifically targets startups in the region.

The Federation of Saudi Chambers and the Chambers of Commerce are participating in the forum activities through a pavilion at the exhibition accompanying the conference.

This participation reflects the important economic role played by the institutional bodies of the private sector in enhancing the nation’s position as an international destination for entrepreneurship.

The “Land of Opportunities” is one of the events hosted by Biban this year. It offers opportunities in asset investment, temporary leasing, direct leasing, and purchase, as well as operation, supply, and competition.

It represents an interactive space that encourages exchange and partnerships between investors and entrepreneurs, supported by close cooperation between the public and private sectors. 

The Biban Talks Theater witnessed a series of sessions on its first day of the event. The discussions addressed various topics that shed light on AI, building the future, and enabling global capabilities. The theater also witnessed in-depth talks on development strategies for startups and small and medium enterprises, in addition to innovation in growth areas from idea to impact. 

The Saudi Premium Residency Center announced that 38 entrepreneurs of 14 different nationalities received “Entrepreneur Residency” status during the Biban 24 Forum. The award aims to empower the sector, attracting and retaining entrepreneurs and investors worldwide to support a diverse, promising economy and enhance the Kingdom’s investment landscape.