Good morning, lovely people, and welcome to the final workday of June. We hope you had plenty of time to recharge during the long weekend, because judging by the news cycle this morning, things are already back to business as usual.

We have several big stories here at home, including the Central Bank of the UAE revising its growth forecast for the year downwards amid global economic uncertainty, XRG’s consortium granted due diligence for its Santos takeover, and Mubadala unwinding its private credit partnership with BlackRock.

WEATHER- It’s a mostly cloudy day today, with Dubai set to see a high of 40°C today, and an overnight low of 31°C. Abu Dhabi will see a high of 36°C and an overnight low of 31°C.

WATCH THIS SPACE-

#1- Dubai regulator reportedly searches Magellan Capital’s offices after whistleblower report: The Dubai Financial Services Authority (DFSA) searched the offices of hedge fund startup Magellan Capital last month, after a former trader accused senior executive Ahmed Omar of concealing losses and blocking staff from escalating risk concerns, Bloomberg reports, citing people familiar with the matter. DFSA officials examined company laptops and phones and questioned employees onsite, though the regulator declined to comment on whether a formal investigation is underway.

ICYMI- The search came after ex-portfolio manager Britney Lam (LinkedIn) filed complaints with both the DFSA and the UK’s Financial Conduct Authority (FCA) in May. Lam, who left Magellan last October after just five months, alleged regulatory breaches and said she raised concerns in a whistle-blower letter to the board that went unaddressed.

Magellan has denied the allegations, saying it is not FCA-regulated and does not manage external client funds. The firm, which had been preparing to launch with USD 700 mn in proprietary capital backed by a Middle Eastern family office, said it maintains full ownership oversight, third-party audits, and whistleblower policies.

#2- Also under scrutiny…: UK oilfield services firm Wood Group — which is currently the target of a takeover bid by UAE-based Sidara — is under investigation by the FCA over its accounting practices, the company said in a statement. The probe covers activity between January 2023 and November 2024, and follows an earlier independent review into how the firm booked certain contracts and exceptional charges. Wood missed its 2024 results filing deadline in April, and its shares have been suspended from trading since 1 May.

Background: The company has been the subject of an on-again, off-again takeover bid from Dubai-based Sidara for over a year. The bid deadline was recently extended to today to allow time to resolve pre-conditions tied to debt restructuring, liquidity, and the delayed audit. Sidara’s latest allcash offer values Wood at USD 318.4 mn with a USD 450 mn debt package, and has been described by Wood’s board as a “better option” for shareholders — though it marks a sharp drop from earlier proposals that valued the firm at GBP 1.6 bn before financial governance issues surfaced.

#3- The UAE is on track to surpass Saudi Arabia in construction awards for the first time since 2018, with USD 31 bn in contracts awarded so far this year compared to USD 20.6 bn in the kingdom, Bloomberg reports, citing MEED data. The shift reflects strong momentum in the UAE’s infrastructure and real estate sectors, while Saudi Arabia pulls back amid funding pressures, rising costs, and shifting priorities. Contracts for the KSA’s Vision 2030 giga projects have fallen to just USD 4 bn this year, down from USD 24 bn in 2024.

Things could still change: Activity may rebound in 2H as contracts linked to the 2034 FIFA World Cup are rolled out.

#4- Dubai to revamp construction sector evaluation: Dubai Municipality will roll out new performance criteria for contracting companies and engineering consultancies starting 2026, as part of efforts to tighten oversight and raise industry standards, according to a Dubai Media Office statement. The updated evaluation system will assess firms based on financial solvency, Emiratization rates, corporate social responsibility involvement, project delivery timelines, use of advanced technologies, and client feedback.

In context: The move came after the Committee of Registration and Licensing the Practice suspended two engineering consultancy offices for six months over ethical and professional concerns.

#5- ADFD backs UAE-GCC power grid link-up: The Abu Dhabi Fund for Development (ADFD) signed an AED 752 mn (c. USD 205 mn) financing agreement with the Gulf Cooperation Council Interconnection Authority (GCCIA) to expand the GCC power grid’s link with the UAE, state news agency Wam reports. The project includes a 400 KV double-circuit transmission line between the UAE’s Al Silaa substation and Saudi Arabia’s Salwa substation, upgrades to substations in Gonan, Al Silaa, and Salwa, and new protection and control systems, and will see the transmission capacity increase from 1.2 GW to 3 GW.

The goal: The expansion aims to strengthen grid capacity, improve emergency response, and boost cross-border power trade. GCCIA said similar interconnection projects with Kuwait, Oman, and southern Iraq are in the pipeline, representing a combined investment of over USD 1 bn.

We knew this was coming: The ADFD was set to fully finance the expansion, for which the GCC Interconnection Authority is aiming to award contracts by mid-year as part of a rush to complete the projects by 2027. The authority had already received 8-10 bids for the expansion with the UAE and Oman.

Refresher: The Gulf Electricity Interconnection Project stretches over around 913 km from Kuwait to Oman and plans to connect all six gulf countries.

#6- Shipping b’naire John Fredriksen has shuttered his London business base and relocated operations to the UAE, saying the UK “has gone to hell” amid mounting dissatisfaction with the economy and tax policy, The Standard reports. Seatankers Management closed its headquarters on Sloane Square, and the Norwegian-born oil tanker mogul — worth an estimated GBP 13.7 bn according to the Sunday Times Rich List — is among a wave of wealthy residents leaving the UK following the Labor party’s dismantling of the non-dom tax regime in April.

DATA POINT-

The UAE’s travel and tourism sector contributed AED 257.3 bn to the national GDP in 2024, representing 13% of the economy, Wam reports, citing data from the World Travel and Tourism Council. The figure marks a 26% increase from 2019 pre-pandemic levels.

International visitor spending was over AED 217.3 bn, up 30.4% from 2019, while domestic tourism expenditure grew 41% from the same year to AED 57.6 bn. Key source markets included India (14%), the UK (8%), Russia (8%), China (5%), and Saudi Arabia (5%).

The breakdown: The sector generated USD 8.6 bn in tax revenue, or 5.4% of government income. WTTC projects international tourism spending will grow by 5.2% this year to reach AED 228.5 bn, whilst domestic spending is set for a 4.3% uptick to AED 60 bn.

PSA-

#1- Sharjah launches instant commercial license: The Sharjah Economic Development Department (SEDD) has rolled out a new service allowing investors to obtain a commercial license within one working day, without requiring a lease contract or memorandum of association in the first year, Wam reports. The license covers office-based activities that don’t require external approvals and permits for up to three employees. Standard licensing requirements must be fulfilled starting in the second year.

#2- Emirates will maintain its suspension of flights to and from Tehran until at least Saturday, 5 July at the earliest, according to a statement. The decision comes despite a ceasefire ending the 12-day conflict between Iran and Israel. Most UAE carriers have resumed normal operations following the recent tensions.

THE BIG STORY ABROAD-

Israel’s attack on Iran’s Evin Prison killed dozens: Israel’s attack on Tehran’s Evin Prison last week killed 71 people, Iranian judiciary spokesperson Asghar Jahangir confirmed yesterday. The prison holds political prisoners and foreigners, marking a shift from Israel’s attacks on military and nuclear sites. Victims included administrative staff, military conscripts, detainees, visiting family members, and nearby residents. (Reuters | New York Times | Associated Press | France24)

AND- Another DeepSeek? Chinese tech giant Baidu will open source its Ernie generative AI model today, in what experts are calling China’s biggest AI move since DeepSeek. While some analysts see it as a challenge to US giants like OpenAI and Anthropic, others say its global impact will hinge on security concerns and market trust. “Baidu just threw a Molotov into the AI world,” Epic Loot founder Alec Strasmore told CNBC, adding that it could trigger a price war in AI services.

***

You’re reading EnterpriseAM UAE, your essential daily roundup of business, economics, and must-read news about the UAE, delivered straight to your inbox. We’re out Monday through Friday by 7am UAE time.

EnterpriseAM UAE is available without charge thanks to the generous support of our friends at Mashreq. Tap or click here to get your own copy of EnterpriseAM UAE.

Want to send us a story idea, request coverage, ask for a correction, or otherwise get in touch? Reach out to us on UAE@enterpriseAM.com .

DID YOU KNOW that we also cover Egypt, Saudi Arabia, and the MENA climate and logistics industries?

***

Tags: