Una's Feed
Mar 26, 2013

Breakingviews: Target shortage feeds desperate Mideast telco M&A

By Una Galani

DUBAI (Reuters Breakingviews) – A scarcity of takeover targets is feeding a desperate scramble in Middle East telecoms M&A. Bahrain’s incumbent operator Batelco BTEL.BH is eyeing a stake in the enterprise unit of Reliance Communications(RLCM.NS: Quote, Profile, Research). It comes just months after agreeing a deal worth $1 billion to buy assets spanning 12 markets, including Monaco and the Channel Islands, from Cable & Wireless. Batelco’s pick-and-mix takeovers are symptomatic of a market where too many big telcos are chasing too few assets.

Batelco is in search of stable cash flows amid fierce competition in its home market. Bahrain accounts for 60 percent of revenue but profit there fell by almost one-third in 2012. Cash flow is weakening and the cash dividend payout ratio has fallen from 75 to 60 percent in just two years.

Mar 19, 2013

Alwaleed’s valuation dispute has simple solutions

(The author is a Reuters Breakingviews columnist. The opinions
expressed are her own.)

By Una Galani

DUBAI, March 19 (Reuters Breakingviews) – The controversy
over the true value of Prince Alwaleed’s investment vehicle has
some simple remedies. Kingdom Holding 4280.SE, with stakes in
everything from Citigroup (C.N: Quote, Profile, Research) to Twitter, is at the centre of
a bitter row with Forbes magazine over the exact size of the
prince’s wealth. Part of the problem is that the Riyadh-listed
company suffers from a tiny free float, limited liquidity, and
puzzling share-price movements.

Feb 20, 2013

$12 bln Qatar fund adds new risk: public scrutiny

(The author is a Reuters Breakingviews columnist. The opinions
expressed are her own.)

(Refiles to fix location in dateline)

By Una Galani

DUBAI, Feb 19 (Reuters Breakingviews) – Qatar’s sovereign
wealth fund may regret spinning off part of its business. The
Gulf emirate known for snapping up high-profile stakes in
publicly listed entities is giving ordinary investors a chance
to get a piece of the action. That, though, opens up the
absolute monarchy to one risk it loathes: public criticism.

Feb 18, 2013
via Breakingviews

Dubai’s new boom assumes short memories

Photo

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Dubai has rediscovered its appetite for grand designs. A replica Taj Mahal four times bigger than the original, the world’s biggest Ferris wheel, several new mega-malls, and over 100 new hotels are amongst a raft of extravagant projects aiming to boost tourism in the emirate. But lingering debt woes from its last boom-and-bust cycle should hopefully reduce the risk of runaway spending.

Jan 23, 2013

Maroc Telecom bidders defy unrest in $6 bln sale

(The author is a Reuters Breakingviews columnist. The opinions
expressed are her own)

By Una Galani

DUBAI, Jan 23 (Reuters Breakingviews) – Politics will play a
major part in the sale of Maroc Telecom (IAM.CS: Quote, Profile, Research). Vivendi
(VIV.PA: Quote, Profile, Research), the French media and telecom conglomerate, is in
shrinking mode. It hasn’t had any trouble drumming up interest
from far-flung corners of the world for its 53 percent stake in
the listed North African telecoms operator. Qatar Telecom
QTEL.QA, the UAE’s Etisalat ETEL.AD and South Korea’s KT
Corp (030200.KS: Quote, Profile, Research), have all submitted expressions of interest.
And France Telecom (FTE.PA: Quote, Profile, Research) is also keeping an eye on the sale.

Dec 14, 2012

India’s Jet a better bet than Kingfisher for Etihad

By Andy Mukherjee and Una Galani

SINGAPORE, Dec 14 (Reuters Breakingviews) – Abu Dhabi’s Etihad Airways is spoilt for choice in India: It could decide to be a white knight to billionaire Vijay Mallya’s beleaguered Kingfisher Airlines. Or the Gulf carrier could snap up a smaller stake in Jet Airways, which controls a quarter of the domestic Indian market. The latter looks the better bet.

On the face of it Kingfisher, whose market value is about one-fourth of Jet’s $960 million, is the cheaper option. It also offers the tempting prospect that Etihad could gain effective operational control through a 46 percent shareholding. But Kingfisher carries additional risks. Its licence was suspended by India’s aviation regulator in October and its employees haven’t been paid for months. Kingfisher’s stripped-down fleet of 12 aircraft is one-eighth of Jet’s capacity.

Dec 14, 2012

Jet Airways a better bet than Kingfisher for Etihad

By Andy Mukherjee and Una Galani

SINGAPORE (Reuters Breakingviews) – Abu Dhabi’s Etihad Airways is spoilt for choice in India: it could decide to be a white knight to billionaire Vijay Mallya’s beleaguered Kingfisher Airlines (KING.NS: Quote, Profile, Research). Or the Gulf carrier could snap up a smaller stake in Jet Airways (JET.NS: Quote, Profile, Research), which controls a quarter of the domestic Indian market. The latter looks the better bet.

On the face of it Kingfisher, whose market value is about one-fourth of Jet’s $960 million, is the cheaper option. It also offers the tempting prospect that Etihad could gain effective operational control through a 46 percent shareholding. But Kingfisher carries additional risks. Its licence was suspended by the aviation regulator in October and its employees haven’t been paid for months. Kingfisher’s stripped-down fleet of 12 aircraft is one-eighth of Jet’s capacity.

Dec 13, 2012
via Breakingviews

Qatar gives SocGen an honourable exit from Egypt

Photo

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

Qatar has given Societe Generale an honorable exit from Egypt. State-backed Qatar National Bank will buy the French bank’s 77 percent stake in its Egyptian unit, National Societe Generale Bank (NSGB), through a mandatory tender offer valuing the whole at $2.6 billion. The valuation of 2 times book value is lower than pre-revolution multiples, and SocGen will have to carry some currency risk. But with few-sizeable buyers willing to live with Arab spring volatility, it makes sense for SocGen to shrink while it can.

Dec 6, 2012
via Breakingviews

Barclays bet lives up to rich billing for Qatar

Photo

By Una Galani

The author is a Reuters Breakingviews columnist. The opinions expressed are her own

A massive bet on Barclays is living up to its rich billing for Qatar. The complex 3.4 billion pound investment in the UK bank has earned a 19 percent internal rate of return for the sovereign fund, according to a Breakingviews calculation. That’s pretty good, factoring in the huge risk of propping up a universal bank at the height of the financial crisis. But it will grate for Barclays shareholders who resented the deal in the first place.

Nov 12, 2012

Egypt may struggle to meet Islamic finance target

(The author is a Reuters Breakingviews columnist. The
opinions expressed are her own)

By Una Galani

CAIRO, Nov 8 (Reuters Breakingviews) – Egypt may struggle to
meet its Islamic finance targets. The new Muslim Brotherhood
government aims to boost the sharia-compliant share of total
banking assets from 5 to 35 percent within five years. The
potential is undoubtedly big. Egypt is predominantly Muslim and
only 10 percent of the 80 million people have bank accounts. But
the rise of Islamic finance in Egypt might be slow.

    • About Una

      "Una Galani is Asia Corporate Finance Columnist of Reuters Breakingviews, based in Hong Kong. She spent three years in Dubai covering the region’s economies in the immediate aftermath of the Arab Spring. Previously, Una wrote on capital markets, mergers and acquisitions, and telecoms across Europe from London. She was commended in the category of Young Financial Journalist at the Harold Wincott Awards for 2009 after joining Breakingviews in 2006. Una read English Literature at Oxford. Follow Una on Twitter @ugalani"
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