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  • Middle East equities hold largely steady


    30 May 2023


    The value of the top listed firms in the Middle East and North Africa (Mena) region held largely steady during the 2022-23 financial year as international investor sentiment wavered over the state of the global economy.

    Viewed through the lens of the MEED Top 100, an annual ranking of the largest Mena-listed companies, the market capitalisation of the top 100 companies stands at $3.83tn, having edged up by a slight 1.6 per cent from the $3.77tn in MEED’s 2022 listing.

    This almost static scenario contrasts with buoyant growth the previous year, when the region’s top stocks leapt in value by 23.4 per cent from only slightly above the $3bn mark amid higher oil prices and post-Covid growth optimism.

    The relative stability of the list also belies some significant downward sliding in the value of oil and gas companies, amid lower oil price projections, and banks, amid higher interest rates and the global banking concerns following the crises at several US and Swiss institutions. The value of Saudi Aramco alone, which accounts for about 55 per cent of the list’s total value, dipped by more than $200bn.

    Growth areas

    The value loss has been balanced by growth in other areas, including telecommunications and real estate – the latter having been particularly supported by a strong recovery in the UAE property market. New entries have also been added to the list following a spree of high-value initial public offerings (IPOs) in 2022 and 2023.

    Notwithstanding the overweighted presence of Saudi Aramco, the banking sector remains the largest contributor to the list, with 34 entities worth a combined $553bn. 

    There are also 16 utilities and telecoms companies worth a combined $369bn; 12 other oil and gas companies besides Saudi Aramco, worth a combined $234bn; and 21 companies in other areas of industry, including manufacturing, construction and logistics, worth a combined $206bn. 

    There are also 10 companies involved in services such as healthcare, retail and technology provision, worth $86bn, and six holding companies making up $270bn. The latter are led by Abu Dhabi’s International Holding Company (IHC), which is valued at $234bn after several years of value growth.

    IPO activity

    The Mena region had an exceptionally strong 2022 for IPOs, with regional stock exchanges seeing a total of 51 listings raise $22bn, close to a quarter of the $90bn raised on equity markets worldwide, according to a report by EY. Overall, it was 143 per cent more listings and 179 per cent more value than in 2021.

    While global IPO activity experienced a decline in both volume and value compared to the previous year, the Mena region remained strong. Both the UAE and Saudi Arabia stand out in terms of the number and value of their recent listings.

    Abu Dhabi had two record-breaking IPOs, first with Borouge in June 2022, in an offering that raised $2bn, and then with Adnoc Gas in March 2023, which raised $2.5bn. 

    Saudi Arabia also went on a listing spree in the fourth quarter of 2022, with seven IPOs on the Saudi Stock Exchange (Tadawul) raising $4.7bn in proceeds. The largest came from Saudi Aramco Base Oil Company (Luberef), which raised $1.3bn. The Tadawul saw its first dual listing, with the UAE’s Americana Restaurants listing on both the Saudi and Abu Dhabi exchanges in December in an IPO that raised $1.8bn.

    The 2023 MEED Top 100 list also incorporates the September 2022 listing of Dubai’s road toll system Salik on the Dubai Financial Market, which raised $1bn; the November 2022 listing of Saudi utility company Marafiq, which secured $897m; the November 2022 listing of Dubai’s Empower, which garnered $724m; and the March 2023 listing of Abu Dhabi’s Presight AI, which brought in $496m.

    The region has largely retained its IPO momentum heading into 2023, with the first quarter seeing 10 new listings raising a total of $3.4bn. Despite a 33 per cent drop in the number of IPOs and a 14 per cent decrease in value compared to the first quarter of 2022, the region outperformed the global market, which saw a 61 per cent drop in IPO volume to 299 IPOs for the quarter, raising $21.5bn.

    Uncertainties over the global economic outlook nevertheless continue to weigh on the markets in 2023, and the GDP forecasts for the Mena region are generally lower than in 2022. Despite these brakes on activity, there is optimism for an ongoing pipeline of large government-backed and private IPOs.

    Major upcoming IPOs include the offering of 15 per cent of the shares of Adnoc Logistics & Services through an IPO on the Abu Dhabi stock exchange, scheduled for June 1. 

    The listing of Abu Dhabi’s Emirates Global Aluminium is also still on the cards, as is the potential listing of Saudi Arabia’s First Mills on the Tadawul. Abu Dhabi-based Lulu Group is also considering a dual listing in Abu Dhabi and Saudi Arabia.

    John Bambridge
  • Contractors prepare Oxagon tunnelling bids


    30 May 2023


    Contractors are preparing to submit bids in June for a contract to build tunnels connecting the offshore elements of the Oxagon industrial city at Neom to the mainland.

    The design-and-build contract involves digging a 6.5-metre-diameter tunnel using a tunnel boring machine (TBM) under the sea that will link the Neom Connector with the offshore elements of Oxagon port. It will house utilities including water pipelines, fibre optic cables and electricity cables.

    Prospective bidders for the contract include:

    • Abuljadayel Company (local)
    • Bessac (France)
    • Binladin Contracting (local)
    • Daewoo (South Korea)
    • Dogus (Turkey)
    • Hassan Allam (Egypt)
    • Petrojet (Egypt)
    • Saudi Pan Kingdom Company (Sapac)
    • Shanghai Tunnel Engineering Company (China)
    • Soletanche Bachy (France)

    Crown Prince Mohammed bin Salman launched Oxagon in late 2021. It will include onshore elements as well as floating structures offshore. Construction works on the 48 square-kilometre, eight-sided industrial city have already started.

    Port construction

    Work is also under way for the industrial city’s port, with Neom tendering a contract to complete the next phase of the Duba port expansion at Oxagon industrial city.

    The prospective bidders are Belgium’s Deme with Greece’s Archirodon; Van Oord of the Netherlands with South Korea’s Hyundai Engineering & Construction; a Belgian joint venture of Jan de Nul and Besix; Netherlands-based Boskalis with France’s Soletanche Bachy; and China Harbour Engineering Company.

    The tender for the project’s second phase follows the award of a contract to deliver the first phase of the port expansion. A team of Boskalis, Besix and the local Modern Building Leaders (MBL) was awarded that estimated SR3bn ($800m) contract in mid-January.

    The scope of the Duba port expansion package includes excavation and dredging, revetments for channel widening, demolition, container terminal quay expansion and earthworks, in addition to the development of a flexible quay, a roll-on/roll-off (RoRo) berth and quay walls to a marine services berth and a coast guard facility.

    Jacobs is the main design consultant with Moffatt & Nichol, IGO and Trent as the main subconsultants.

    Port operations

    Several crane and container equipment contracts have been awarded to Saudi Liebherr Company and Shanghai Zhenhua Heavy Industries Company (ZPMC).

    Saudi Liebherr was awarded contracts for 10 mobile harbour cranes for SR200m.

    ZPMC has been awarded contracts for 10 ship-to-shore gantry cranes, 30 electric rubber-tiered gantry cranes and six automated rail-mounted gantry cranes for over SR1bn. ZPMC will work with Siemens Europe to deliver the automation components. 

    An expanded Duba port is a critical component of Oxagon and the broader Neom development, as it will allow greater volumes of materials to be imported for the project. With an expected investment value of $500bn, Neom is the largest programme of construction work in the world.

    Neom says the first container terminal will be operational by the beginning of 2025.

    The management of Duba port was transferred from national maritime regulator Mawani to Neom in 2022.
    Colin Foreman
  • Dewa commissions Lusaily reservoir


    30 May 2023

    Dubai Electricity & Water Authority (Dewa) has announced that it has commissioned the third phase of its water reservoirs in the Lusaily area.

    The project has a storage capacity of 60 million imperial gallons (MIG) and investments totalling AED157.4m ($42.9m).

    Dewa says the project supports its efforts to enhance water security and keep pace with the increase in demand.

    “We continue to strengthen our robust state-of-the-art infrastructure and adopt innovation and the latest tools for anticipating the future,” says Saeed Mohammed al-Tayer, managing director and CEO of Dewa.

    “This supports the Dubai Integrated Water Resource Management Strategy 2030 and the UAE Water Security Strategy 2036. Our sound scientific planning has helped us keep pace with the growing demand for water in Dubai, according to the highest international standards.

    “In 1992, Dewa’s production capacity of desalinated water was 65 million imperial gallons a day (MIGD). Today it has increased to 490MIGD,” he adds.

    Dewa also confirmed its plans to commission other reservoirs in Dubai this year.

    “In addition to the water reservoir in Lusaily, we are working on three other reservoir projects in Nakhali, Hassyan and Hatta. These are expected to be completed this year and next year. With the completion of these projects, the storage capacity will increase from 881MIG currently to 1,151MIG of desalinated water,” says Al-Tayer.

    The local Ghantoot Gulf Contracting was awarded the contract to build the third phase of the Lusaily reservoir in 2018.

    Ghantoot was also working on another major Dewa project. However, in October 2022 Dewa said it had terminated its contract with the consortium Ghantoot Transport & General Contracting and Ghantoot Gulf Contracting on its Al-Sheraa headquarters building project in Dubai.
    Colin Foreman
  • Firms compete for work on Dubai’s Candy towers


    30 May 2023


    Dubai World Trade Centre (DWTC) and UK-based Candy Capital are tendering consultancy work on their project to construct three towers at Dubai’s One Central commercial district.

    The roles that firms are competing for include project management, cost consultancy and engineering.

    The selected firms will join the local Killa Design, appointed as the project’s architect.

    The three towers, ranging in height from about 160 to 390 metres, will be technically challenging. One of the main engineering challenges will be the multi-level sky bridge that connects the two taller towers and will contain one of the development’s hotels.

    The mixed-use towers are expected to have two branded residences, two hotels and office space. 

    DWTC and Dubai World Trade Centre confirmed their plans for the project in April.

    “DWTC and Candy Capital have formed a partnership and are collaborating on a new super-prime real estate development. This will be announced in more detail later this year,” said a representative of the joint venture in a statement given to MEED.

    Image: Candy Capital is a privately held family office established by British entrepreneur and businessman Nick Candy. His best-known property development is One Hyde Park in London (pictured), which he developed with his brother Christian. It consists of 86 apartments and three retail units and is considered one of the wealthiest residences in the world.
    Colin Foreman
  • Saudi Arabia’s Modon plans $2.7bn of infrastructure


    30 May 2023

    The Saudi Authority for Industrial Cities & Technology Zones (Modon) is expanding the infrastructure at its industrial cities and facilities across the kingdom as it seeks to attract increased private sector investment.

    The estimated SR10bn ($2.7bn) five-year plan comprises several main elements.

    The largest, worth SR5.8bn, covers the construction of multiple roads, bridges, water and electricity networks and other associated facilities to provide base infrastructure services.

    Examples include the construction of a bridge linking the main highway system with Jeddah’s second industrial city, and a new rainwater collection network at the Waad al-Shamal industrial complex in the far north.   

    The second component is worth about SR2.1bn and involves building works such as new fire stations, ready-to-lease warehouses, office buildings and storage areas.

    The final element involves the construction of transmission and distribution systems, including a high-voltage substation in Sudair and new overhead lines to serve Al-Kharj industrial city, in a programme worth about SR1.8bn.

    Modon operates 31 industrial cities across the kingdom, including three each in Riyadh, Dammam and Jeddah. It also has four ‘oases’ under its remit where only women can work, and provides basic infrastructure services to more than a dozen private industrial cities.

    Its mandate additionally covers Riyadh Technology Valley, Al-Raidah Digital City and the Wadi Makkah Technological Complex.

    MEED's latest special report on Saudi Arabia includes:

    > GIGAPROJECTS: Saudi Arabia under project pressure
    > ECONOMY: Riyadh steps up the Vision 2030 tempo
    > CONSTRUCTION: Saudi construction project ramp-up accelerates
    > UPSTREAM: Aramco slated to escalate upstream spending
    > DOWNSTREAM: Petchems ambitions define Saudi downstream
    > POWER: Saudi Arabia reinvigorates power sector
    > WATER: Saudi water begins next growth phase
    > BANKING: Saudi banks bid to keep ahead of the pack
    > DATABANK: Riyadh holds its buoyant economic heading
    Edward James
  • Iraq’s spending plans lower fiscal forecast


    29 May 2023

    Register for MEED's guest programme 

    MEED's June 2023 special report on Iraq includes:

    > COMMENTIraq’s bumper budget holds promise and risk
    > GOVERNMENT: Al-Sudani makes fitful progress as Iraq's premier
    > ECONOMYIraq hits the spend button
    > UPSTREAM DEVELOPERSNo place like Iraq for international oil firms
    > OIL & GASIraq's energy sector steadily expands
    > POWERIraq power projects make headway
    > CONSTRUCTIONTransport plans underpin Iraq’s reconstruction


    Main image: Basra International Stadium
    MEED Editorial
  • Saudi and Chinese firms plan $500m PV wafer factory


    29 May 2023


    Saudi Arabia's Vision Industries and China's TCL Central New Energy Technology Company have signed the term sheet agreement to establish a joint venture to implement the kingdom's first photovoltaic (PV) crystalline chip factory.

    The first phase of the planned ingot and wafer manufacturing plant will have the capacity to produce 150 millimetres (mm) to 200mm of micron wafers. 

    A solar wafer is a thin slice of a crystalline silicon or semiconductor, which is vital for fabricating integrated circuits in PVs to manufacture solar cells. Polysilicon grains or pebbles comprise the main input product for production.

    MEED understands the project's first phase will require an investment of around $500m. It is envisaged to produce wafers for domestic solar PV production, which can then be consumed domestically or exported.

    The plant's potential location has not yet been disclosed. MEED understands the project's initial phase could support solar PV production of up to 10GW a year.

    Another Saudi-Chinese joint venture plans to build a wind turbine manufacturing facility at Oxagon in Saudi Arabia's Neom gigaproject development.

    The planned facility will have the capacity to manufacture wind turbines that can produce an equivalent of 3GW of electricity. MEED reported that it will require an investment of approximately $1.5bn.

    Saudi Arabia's Vision Industries and China's Envision are investing in the wind turbine manufacturing plant project, which aims to cater to the growing demand for wind turbines in the broader Middle East and Africa region in light of widespread decarbonisation initiatives.

    The first wind turbines are expected to roll out of production by the first quarter of 2025.

    Vision Industries is a joint venture of Saudi Arabia's Abunayyan Holding and Al-Muhaidib Group.

    Over $120bn-worth of wind and solar PV power generation plants are in the study, design and procurement phases across 16 countries in the Middle East and North Africa  (Mena) region, according to MEED Projects data.

    Morocco, Egypt and Saudi Arabia have the largest potential markets.
    Jennifer Aguinaldo
  • Jeddah plans $31bn airport expansion


    29 May 2023


    Register for MEED’s guest programme 

    Jeddah Airports Company (Jedco) plans to transform King Abdulaziz International airport (KAIA) into one of the world’s largest airports with a SR115bn ($31bn) expansion plan that will increase its capacity to 114 million passengers a year.

    The largest components of the plan cover the design and expansion of Terminal 1 and the construction of a new passenger terminal to be called Terminal 2.

    The expected completion date for the expansion project is 2031.

    Terminal plans

    The Terminal 1 project comprises basic infrastructure and enabling works, the installation of new gates, air bridges and parking aprons, the extension of the automatic people mover, new baggage conveyor systems and lounges, with the goal of increasing annual passenger capacity by 15 million.

    Work on the multibillion-dollar scheme is scheduled to start this year, with completion targeted for 2026.

    The Terminal 2 project aims to increase the airport’s total capacity to 114 million passengers a year, almost tripling the airport’s 40 million limit today.

    Due to start in 2026 and end by 2031, the project will involve constructing a completely new terminal building with dozens of gates, new taxiways, aprons, roads, utilities, and baggage handling and other software systems. It is likely to be worth in excess of $10bn to build.

    Jedco is also planning to construct a fourth runway starting in 2025 and completing by 2029 to cope with the increased traffic. Due to space limitations, the new runway will require substantive infrastructure relocation work to accommodate it.

    Passenger traffic-focused developments are not the only element of the plan. As part of growing the airport’s commercial proposition, the client is also due to start developing a new logistics area later this year.

    Covering more than 3 square kilometres, the facility will house new customs and service buildings as well as several leasable warehouses for the private sector. Construction of the facilities will be implemented in phases with an ultimate scheduled completion date of 2029.

    Concurrently, Jedco is building a new Hajj and Umrah terminal. Pilgrims comprise a large portion of passenger traffic, and the new arrivals and departures hall for budget airlines will be able to handle 15 million passengers a year. The project is expected to be completed by 2025.

    Another project starting this year is the construction of a new baggage handling facility to expand the airport’s existing capacity. The building will be located next to Terminal 1 and will be integrated with the existing conveyor belt systems.

    Passenger demand

    The project investment programme is a result of Jedco’s forecast that annual demand will reach 114 million passengers by 2030. Of this figure, the authority estimates 51 million will come from Saudi Arabian Airlines, 21 million from international airlines, and 13 million and 12 million from budget airlines Flynas and Flyadeal, respectively.

    The forecast and plans were created in conjunction with key drivers of future passenger demand in the Mecca and Jeddah region, including gigaproject real estate developers Roshn and Uptown Jeddah, air cargo handler Saudi Logistics Services (SAL), and the General Civil Aviation Authority (Gaca) with its subsidiary Matarat Holding. Engineering firms Atkins, Mace and DGJ also inputted into the process. The three companies are the consultants on the capital projects investment plan.

    KAIA has three operational terminals. Opened in 2018, Terminal 1 is one of the world’s largest passenger terminals, and caters primarily for the state carrier and domestic flights. The North Terminal handles international airlines, while the Hajj Terminal is dedicated to pilgrim traffic.

    Construction work on KAIA has been a key driver of airport-building activity in Saudi Arabia in the past. In 2010, there were over $7bn of contract awards for work at the airport, marking the most active year for airport construction activity on record, according to regional projects tracker MEED Projects.

    There are other major airport projects planned in Saudi Arabia. In November, Saudi Arabia’s Crown Prince Mohammed bin Salman bin Abdulaziz al-Saud announced the masterplan for King Salman International airport in Riyadh. If completed on time in 2030, it will become the largest airport in the world in terms of passenger capacity.

    The airport aims to accommodate up to 120 million passengers by 2030 and 185 million by 2050. For cargo, the goal is to process 3.5 million tonnes a year by 2050.

    Neom airport

    Another major airport is planned for Neom. US firm Aecom confirmed on 22 March that it had been awarded a contract to provide project management consultancy (PMC) services for the new airport project.

    The airport will be inland, close to the Tabuk end of the 170-kilometre-long Line development. Neom International airport is separate from the Neom Bay airport, which started receiving commercial flights in 2019.

    Although not confirmed, it is understood that the first phase of the airport will have the capacity to handle 25 million passengers a year. A second phase could take the capacity up to 50 million passengers a year. There is an aspiration for the airport to become the largest in the world, with a capacity of 100 million passengers a year. 

    Regional airports

    Smaller domestic airports are also being developed. In March, Matarat signed a three-year contract with France’s Egis Group to provide technical support and project management services for 26 regional airports.

    The contract aims to establish phased project management portals, update airport project management policies and procedures, and provide technical support for planning and designing.

    The contract also involves following up on the implementation of capital projects with Matarat subsidiaries, including Riyadh Airports Company, Jeddah Airports, Dammam Airports and Cluster2.
    Edward James
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