Good morning, wonderful people. Happy hump day to you all — two more after today and we can all slide into the weekend.

Driving the conversation this morning: The World Defense Show, as we suggested on Sunday might be the case. We also have coverage this morning of the latest purchasing managers’ index (no real surprises), Saudi Electricity’s roadshow for its newest sukuk, SNB Capital’s new real estate fund, and Kazyon’s acquisition of a 50% stake in Dukan, the country’s only hard discounter.

BUT FIRST- LuLu Group International, the operator of the iconic supermarket chain, is shopping around for bankers for a potential dual-listing on the ADX and Riyadh’s Tadawul in 2H 2024, Bloomberg reported overnight. The offering could be worth as much as USD 1 bn, the business information service says, citing sources it says have knowledge of the company’s plans.

Abu Dhabi-headquartered LuLu is likely to list its GCC assets in the transaction. The company valued itself at north of USD 5 bn in 2020 when it sold a stake to Abu Dhabi wealth fund ADQ and last explored the possibility of an IPO in 2022. LuLu was thought in late 2023 to have been discussing the potential sale of a stake to Saudi Arabia’s Public Investment Fund.

In context: Dual listings on the UAE and Saudi Arabia are rare. MENA restaurant operator Americana Restaurants went for an ADX + Tadawul listing in 2022. LuLu declined to comment on Bloomberg’s report.

By the numbers: LuLu has 18 hypermarkets and seven shopping malls in its pipeline as it pushes ahead with aggressive growth plans. It has some 70k employees across more than two dozen countries, but its centers of gravity are the GCC, India and, more recently, Egypt.

HAPPENING TODAY- The PIF Private Sector Forum runs today and tomorrow in Riyadh.The event will bring together the fund, portfolio companies, and the private sector.

PSA #1- The Zakat, Tax and Customs Authority (Zatca) is again warning about fake text messages and emails asking taxpayers for banking data for refunds, Mubasher reports. The authority only requests personal information through official channels including its website and its mobile applications.

PSA #2- Is your spawn about to apply to college abroad? We have two stories you’ll want to know about this morning:

  • Top US colleges are looking to once again require SATs and ACTs for kids seeking admission. Many colleges are making decisions now about their fall 2025 intake — and those backing standardized testing just got a boost from Dartmouth, which is bringing back the tests. (Financial Times | NPR | New York Times)
  • Canada has extended its ban on foreign ownership of real estate by another two years as part of a bid to ease a housing shortage. The Great White North has also imposed a cap on the number of student visas it will issue.

WEATHER- Expect hazy sun in Riyadh and Dammam today, while it’s shaping up to be a cloudy day in Taif with some rain in the cards for Thursday.

  • Riyadh: 22°C daytime / 8°C overnight
  • Dammam: 22°C daytime / 8°C overnight
  • Taif: 21°C daytime / 9°C overnight

DIPLOMACY-

The war in Gaza, navigation in the Red Sea, and “regional integration” were at the top of the agenda yesterday when US Secretary of State Antony Blinken made Riyadh the first stop on his latest tour of the Middle East.

A sit-down between the Crown Prince and Prime Minister Mohamed bin Salman and Blinken lasted two hours, Reuters reported. Blinken did not respond to questions from reporters on what was discussed during the meeting. He is scheduled to visit Egypt, Qatar, Israel, and the West Bank through Thursday, 8 February.

On the agenda yesterday: An “enduring end to the crisis in Gaza,” “building a more integrated and prosperous region and reaffirm[ing] the strategic partnership between the United States and Saudi Arabia” (read: recognition of Israel in return for an expanded US defense pact). The two also discussed the situation in the Red Sea, a readout from the State Department said. You can check out state news agency SPA’s take here.

REMEMBER- Blinken’s visit comes as negotiators from Egypt and Qatar try to strike an agreement on a longer ceasefire in Gaza in return for the release of Israeli hostages.

Key to the visit: Delivering “a message directly to countries in the region that the United States does not want to see the conflict escalated and will not escalate the conflict,” a senior US official told reporters during the trip to Riyadh. “It’s important to show up and say it on one-on-one,” the official added.

WATCH THIS SPACE-

The Investment Ministry has removed fiscal data it published early yesterday in a monthly bulletin on its website. The data suggested the state budget had recorded a surplus of SAR 16 bn in FY2023, Reuters reports. The newswire says a government official told it the data didn’t represent the Finance Ministry’s latest figures for last year and were published in error.

MEANWHILE- Mubasher has a story that shows a screenshot of the now-deleted data showing that revenues came in at SAR 1.13 tn in FY2023, while expenditures recorded SAR 1.11 tn, and debt totalled SAR 951 bn. That’s an exact match to what the Finance Ministry penciled into its FY2023 budget statement (pdf).

DATA POINTS-

The total number of employees in the private sector hit a record high in January to c. 11.1 mn, state news agency SPA said yesterday, citing a report by the National Labour Observatory. There are some 2.3 mn citizens now working in the private sector, with expats accounting for 8.7 mn private-sector employees.

Residential mortgages to individuals plunged 35% y-o-y in 2023 to SAR 77.7 bn, Argaam reported, citing data from SAMA. This marks the highest annual decline in residential real estate financing provided by banks since 2018.

THE BIG STORY ABROAD-

One story dominates front pages of the global press this morning: The UK’s King Charles III has been diagnosed with an unspecified “form of cancer” at the age of 75, a year and a half after acceding to the throne, according to a statement released by Buckingham Palace yesterday. Charles will continue to work behind closed doors, but will be stopping public activities while he seeks treatment.

The story got plenty of ink in the int’l papers:BBC | Associated Press | NBC News | Reuters.

TECH NEWS-Microsoft is trying its hand at AI-aided journalism: Microsoft has reportedly handed media startup Semafor a “substantial” amount of money to develop a breaking news channel — dubbed Signals — that will use AI to help journalists write daily news and analysis, the Financial Times wrote.

IN MEMORIAM- Richard Debs, the longtime Middle East hand of Morgan Stanley who led a boardroom coup in 2005, has died at 93. Readers of a certain age will recall that Debs, a Fulbright scholar in Egypt in the 1950s, led Morgan Stanley’s push into Cairo and Riyadh starting in the late 1970s. After retirement, was advisory director and chairman of Morgan Stanley Saudi Arabia and chairman (later emeritus) of the American University in Beirut. See obits in the New York Times ’s Legacy and Bloomberg.

CIRCLE YOUR CALENDAR-

Filipino exporters are coming to town: A business-matching tour will kick off on Saturday, 10 February, where a group of Filipino exporters of food, beverage and personal care products will tour Riyadh, Jeddah, and Dammam to market their businesses, Arab News reports.

The Hail Toyota International Rally which will kick off on 8 February and wrap up on 10 February. You have until Saturday, 27 January to register.

The Saudi Capital Market Forum will open on Monday, 19 February and wrap up on Tuesday. Held under the theme “Powering Growth,” the event will bring together members of the global financial landscape for discussions on the capital markets and investment strategies.

Jeddah will host the 2024 West Asian Football Federation (WAFF) Women’sChampionshipon Monday, 19 February until Thursday, 29 February. The tournament, which is the first official 11-a-side women’s tournament at home, marks the women national team’s first-ever participation in the championship.

The Diriyah Contemporary Art Biennale will kick off in Diriyah on Tuesday, 20 February and wrap up on Friday, 24 May. Headlined After Rain, it will be led by German curator Ute Meta Bauer and features 92 artists from 43 countries. It will see several new commissions, including a joint project documenting “Saudi futurism” since the 1940s by local artist Ahmed Mater and Berlin-based photographer Armin Linke.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

Tags: