THIS MORNING: Debt spreads widen again + Is e& scaling back its expansion plans?

Good morning, friends, and happy FRIDAY. The Dubai Media Office just issues a strong-worded warning to all media outlets that “publish incorrect news or information related to the Emirate of Dubai,” saying it would take necessary measures against them, after Reuters reported yesterday of sounds of explosions in Downtown Dubai, a claim the media office refuted later in a statement. Reuters later withdrew its original report and said it couldn’t verify the source of the sounds.

On to the morning's actual business news… Uber wants to own Delivery Hero — and with it, indirect control of DFM-listed Talabat — in a USD 14.8 bn bid that would create the largest food-delivery platform outside China. Dubai's housing market delivered a record number of units this quarter — but the supply is landing in a softer market with fewer buyers, Savills says. And Edge just went from minority investor to full owner of a Brazilian aerospace shop, the latest step in a pattern we've been tracking all month.

Plus: Debt spreads across the region just hit their widest point in nearly four years as the ceasefire keeps fraying.

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Back to square one?

The average sovereign risk premium across Middle Eastern governments jumped by roughly 20 basis points to 402 basis points over Treasury yields in the week since President Trump effectively ended the interim US-Iran ceasefire and attacks continued, Bloomberg reports. That's the widest the spread has been in almost four years, and it's on pace for the fastest YTD widening since 2018.

The region had just spent June recovering: As we reported at the time, spreads had tightened meaningfully from their war-era wides. Bahrain returned to public debt markets for the first time since the fighting began, and banks started rushing back into debt markets. Bankers we spoke with then were bracing for a normal summer lull — not a reversal. We’ll be keeping an eye on the pricing of upcoming issuances and how spreads move in the next few weeks.

G42’s American option

Is G42 considering selling a stake to US investors? That’s what the Wall Street Journal is reporting, citing people familiar with the matter. The WSJ quotes Emirati officials as saying that the Abu Dhabi AI group could become a US company mostly owned by US investors.

The timing matters: The US moved the UAE into Country Group A:5 earlier this week, giving approved Emirati and US entities in the UAE broader license exceptions for sensitive exports. G42 and Core42 are on the approved list, but their licensefree access expires after 270 days unless BIS extends it.

So? While we don’t know the specifics and G42 has yet to confirm any plans of a stake sale, a US investor base likely helps ease ongoing security concerns around exporting advanced compute to the firm — an issue that WSJ says is still drawing attention in Washington, with some scrutinizing alleged financial ties between National Security Adviser Sheikh Tahnoon bin Zayed al Nahyan’s and President Donald Trump.

e& dials back the tech empire

Telco operator e& is unwinding much of its global expansion strategy and refocusing on core telecoms under new CEO Masood M. Sharif Mahmood, Reuters reports, citing two people familiar with the plans. Mahmood took the helm in April after Hatem Dowidar’s six-year tenure, with the group now retreating from the broader tech-company ambitions pursued under his predecessor.

What’s under review: One source said e&’s push into technology, venture investing, and international assets had not delivered the returns shareholders hoped for, making steadier and easier-to-manage telecom returns the priority. The review includes the venture arm e& capital and the SME lender Beehive, though no final decisions have been made. e& is expected to retain control of e& PPF Telecom Group and its emerging-market telecom operators.

The pivot seems to have already begun: e&’s USD 5.95 bn sale of its full 16% Vodafone stake and the partial disposal of its Careem super-app holding to Uber have both come following a “comprehensive review of its international portfolio.”

The balance-sheet upside: We reported earlier that the Vodafone exit will generate a roughly USD 1.3 bn net return. HSBC expects the sale to cut net debt-to-EBITDA to around 0.5x by end-2026 from 1.1x, potentially opening the door to higher dividends, Reuters reports, while Citi says it will also reduce earnings volatility tied to Vodafone’s share price.

UAE moves to standardize university licensing nationwide

The UAE is moving to standardize how higher education institutions are licensed nationwide by creating a single reference point for universities and colleges, including those operating in freezones, state news agency Wam reports. What's actually being standardized: licensing requirements, assessment and compliance mechanisms, institutional sustainability requirements, and license renewal procedures.

PSA

WEATHER- The mercury reaches 43°C in Dubai and 42°C in Abu Dhabi, with lows of 32°C and 33°C, according to our favorite weather app.

The big story abroad

It’s a quiet morning in the business press, with the Financial Times’ front page story looking at the US chip sell-off amid a “deleveraging” phase and broader market volatility, and Bloomberg taking note of SpaceX’s scrapped Starship rocket mission, which had to be canceled due to issues with the engine. SpaceX shares extended their losses on Blue Ocean after ending the trading day down yesterday, and after breaking below their USD 135 IPO price for the first time on Wednesday.

Meanwhile, the Guardian says the recovery plans and ambitious masterplan for Gaza put forward by President Donald Trump’s Board of Peace seem to have shrunk to a “tiny pilot scheme” in Rafah, south of Gaza, as Israel continues to violate the US-brokered ceasefire and bar the NCAG, a body of 13 Palestinian professionals and technocrats convened by the BoP earlier this year, from entering Gaza.

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