Adia going long on China AI?

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WHAT WE’RE TRACKING TODAY

THIS MORNING: BlueFive Capital eyes Bugatti Rimac

For the final time in 2025: Good morning, friends. We hope you all enjoy ringing in the new year — and a restful few days of vacation with family and friends — before kicking off 2026 in earnest.

** EnterpriseAM UAE will be off for the rest of the week for New Year’s. We’ll be back in your inboxes at our customary time on Monday, 5 January.

We’re closing out the year with news that the Abu Dhabi Investment Authority set to anchor the USD 600 mn Hong Kong IPO of Chinese AI startup MiniMax, as well as an update from the 1 GW Al Dhafra plant, on which Ewec and Taqa have reached financial close — and a recap of how the non-oil sector became the primary engine of economic growth in 2025.

Watch this space

YEMEN — A Saudi-led coalition hit Yemen’s Mukalla port with a limited airstrike, targeting what Riyadh described as weapons and heavy-vehicle shipments aboard two vessels arriving from Fujairah. The first has been identified as the St. Kitts and Nevis-flagged Greenland, a RoRo vessel. “The ships’ crew had disabled tracking devices aboard the vessels, and unloaded a large amount of weapons and combat vehicles in support of the Southern Transitional Council’s (STC) forces,” a statement published by state news agency SPA said. Saudi Arabia made the move to combat the STC’s military advances on its southern border with Yemen, which it deemed a “threat to the national security of the Kingdom.”

UAE to pull its remaining troops in Yemen: Presidential council head of the Aden-based central government Rashad Al Alimi accused the UAE of “pressuring” the STC to “undermine and rebel against the authority of the state.” Al Alimi also announced that Yemen is canceling its defense pact with the UAE. The UAE Foreign Ministry issued a statement refuting claims of contributing to tensions in the country, asserting the targeted vessel didn’t contain any weapons and the vehicles were destined for Emirati forces in Yemen. The statement stressed support for Saudi Arabia’s “sovereignty and national security” and noted that the Aden-based government had requested its presence in the country.

A final withdrawal: A separate Defense Ministry statement reported by Wam said the UAE is pulling its final counter-terrorism teams from Yemen after withdrawing its main military presence in 2019.

Background: The STC — which the UAE has in the past backed — seized power across southern Yemen earlier this month in a major move analysts were concerned could potentially split the country into two states for the first time in decades. A UAE official told Reuters at the time that the UAE’s position on Yemen “is in line with Saudi Arabia in supporting a political process” that is based on UN resolutions.

The UAE no longer has a footprint in Yemeni ports: Dubai’s DP World sold its stake in the company managing Aden Port’s container terminal — the Yemen Gulf of Aden Port Corporation –— back in 2012. This ended a strained relationship between the leading port operator and Yemen’s post-revolutionary government over the port’s management.

M&A WATCH — BlueFive Capital eyes Bugatti Rimac: Abu Dhabi-based BlueFive Capital and global VC HOF Capital are reportedly in advanced talks to acquire liquidity -strapped Porsche’s stake in the Bugatti Rimac venture, Bloomberg reports, citing people it says are familiar with the matter. Porsche holds 45% of Bugatti Rimac and 24% of Rimac as of 2021. Rimac expressed interest in wanting to buy out Porsche last April, in light of strategic and cultural friction between the two. Talks are ongoing, with sources suggesting an agreement could be signed in the coming weeks.

Valued at EUR 1 bn, the potential transaction would see the consortium pick up Porsche’s interest in the hypercar joint venture while also purchasing a direct stake in parent company Rimac Group. The transaction is expected to inject fresh capital into Rimac Group to fund its continued expansion. The Croatian group says it delivered 136 Bugatti and Rimac vehicles and 30k batteries and drive systems in 2025, with revenue nearly tripling to about EUR 860 mn.

The acquisition is a strategic wager on the convergence of heritage luxury and EV technology. By backing Bugatti Rimac, the investors are securing a unique asset that controls both the world’s most exclusive hypercar brand and the underlying battery technology supplying the wider automotive industry.

DISPUTES — Good news for Shuaa: The Court of Appeal upheld a ruling to dismiss a AED 22 mn lawsuit filed against Shuaa Capital by a former employee, according to a DFM disclosure (pdf). The court cited a lack of factual or judicial basis for the claim, which was filed last year by a former executive seeking AED 22 mn in severance.

PSA-

Say goodbye to paper tax certificates: Starting 1 January, businesses registered under the UAE’s Federal Tax Authority will not be required to pay for paper tax certificates but can instead receive a digital tax registration certificate with a QR code for status verification, Gulf News reports, citing Cabinet Decision No. 174 of 2025.

THE BIG STORY ABROAD-

A couple of stories are making headlines on the last morning of 2025:

#1- Warner Bros Discovery is reportedly leaning toward rejecting Paramount Skydance’s amended USD 108.4 bn hostile takeover bid, despite a personal financing guarantee from Oracle founder Larry Ellison, Reuters reports citing a person familiar with the matter. The board still favors a lower-value USD 82.7 bn merger with Netflix, viewing it as a path of least resistance with fewer regulatory hurdles.

#2- Fed minutes reveal a central bank at a crossroads: Minutes (pdf) from the Fed’s December meeting showed a committee deeply fractured over the path for 2026, especially when it comes to the timing and size of the cuts to come. While officials voted 9-3 to lower rates to 3.5%-3.75%, the record shows some members only supported the cut by a “fine balance,” while others argued for a hold.

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Adia reported as anchor investor for Chinese AI startup MiniMax’s USD 600 mn IPO

The Abu Dhabi Investment Authority (Adia) is reportedly set to anchor the USD 600 mn Hong Kong IPO of Chinese AI startup MiniMax, alongside China’s e-commerce giant Alibaba, Bloomberg reports, citing people familiar with the matter.

Why MiniMax: Founded in 2022 by a former SenseTime executive, MiniMax is one of the few survivors of China’s generative-AI price war and among the first domestic GenAI players to test public markets.

What it does: The company builds multimodal models spanning text, audio, images, video, and music, pitching itself as a full-stack AI platform rather than a single-use model provider. It generated USD 30.5 mn in revenue last year, offering investors relatively clean exposure to China’s AI buildout.

IPO mechanics: The company is targeting a valuation north of USD 4 bn, Reuters previously reported. Investor orders could open as early as this week ahead of a January debut, with cornerstone demand expected from Hong Kong-headquartered IDG Capital, China’s Perseverance Asset Management, and South Korean firm Mirae Asset, according to Bloomberg.

Zoom out

The transaction fits Adia’s widening exposure across the AI stack: As we previously reported, an Adia subsidiary and Singapore’s GIC wrapped up a USD 1.6 bn equity investment in Vantage Data Centers last month, scaling hyperscale capacity across Asia to roughly 1 GW.

The bigger signal

This also lines up with a rotation we’ve been tracking — global capital moving into Chinese AI on cheaper valuations and power advantages, as scrutiny intensifies around the cost curve and returns of US-led AI spending. However, the UAE’s AI ties to China have recently been somewhat thorny after the supply of US Nvidia chips to state AI firm G42 was contingent on severing ties with Chinese tech firms and divesting from Huawei.

Taqa reaches financial close on AED 3.6 bn Al Dhafra gas power plant

The Abu Dhabi National Energy Company (Taqa) and Emirates Water and Electricity Company (Ewec) reached financial close on the Al Dhafra gas power plant, according to a disclosure (pdf). Taqa will fully own and operate the AED 3.6 bn, 1 GW plant under a 24-year power purchase agreement signed with Ewec earlier this year, with construction already underway.

About 85% of the project is debt-funded through a consortium of local and international banks including Standard Chartered, Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Agricultural Bank of China, Ajman Bank, Boubyan Bank, Doha Bank, First Abu Dhabi Bank, HSBC, ICBC, KfW, National Bank of Kuwait, Rakbank, and Woori Bank.

The bigger picture: The project is part of Taqa, Ewec, and Masdar’s AED 36 bn push in Abu Dhabi’s energy infrastructure. This includes deploying Masdar’s 5.2 GW solar and 19 GWh battery storage project, with the majority of output earmarked for AI data centers, supporting the UAE 2031 National Strategy for AI.

The regional edge: The region’s rising cluster of energy projects — like Al Dhafra project — offer an advantage in the AI race, as lower-than-average energy tariffs (USD 0.05-0.06 / kWh vs USD 0.09-0.15 / kWh in the US) are an edge in an industry where computation and cooling energy are essential.

2025 was the year of non-oil sector-led growth in the UAE

The rise of the non-oil engine: The UAE economy effectively decoupled from oil price fluctuations in 2025 as the non-oil sector evolved from a secondary character to the primary engine of growth. This script switch saw the non-oil sector’s contribution hit a record 77.5% of real GDP in 1H 2025, driving total real GDP growth to 4.2% and reaching a value of AED 929 bn. The shift was seen across emirates, with Abu Dhabi seeing non-oil activities accounting for 56.8% of its economy for the first time in 2Q 2025.

Private sector performance also did well: Despite regional geopolitical headwinds that temporarily slowed the purchasing managers’ index (PMI) to a low of 52.9 in July, the private sector showed resilience and staged a turnaround before the year was out. By November, the index rose to an 11-month high of 54.8 points, boosted by favorable market conditions and a jump in new orders.

This recovery coincided with a controlled inflationary environment, as the country’s headline inflation remained largely contained, stabilizing at 0.6% y-o-y by the end of 2Q 2025 due to lower energy costs. While Dubai saw a temporary spike to 3.36% in October, it cooled back to 2.73% in November, driven by a slowdown in rental and fuel price growth.

Legislative overhaul: From tax ease to institutional compliance

These figures were also supported by fiscal overhaul measures from the Finance Ministry to improve fiscal sustainability, including some tax changes and moves to maintain a favorable business environment. To align with OECD global standards, the UAE raised the minimum corporate tax for large multinational companies from 9% to 15% (domestic minimum top-up tax) from 1 January.

Other legislative milestones: The reforms also included the approval of the e-invoicing system, expanding the scope of exemptions for freezone companies, and imposing qualitative taxes such as Sharjah’s introduction of a 20% natural resources tax. This is in addition to new amendments to the Tax Procedures Law announced earlier this month. These measures aim to shift the economy from reliance on tax ease to full institutional compliance.

Legislative flexibility to support investment and family businesses: To maintain the country’s attractiveness as a financial hub, the Finance Ministry balanced new taxes with qualitative incentives. Freezone exemptions were expanded to include strategic sectors such as chemicals and environmental goods, and companies were allowed to deduct depreciation of investment properties from their taxable income. The Federal Tax Authority also launched facilities that allow family foundations to be treated as unincorporated partnerships, giving them greater flexibility in managing their wealth for tax purposes.

We’re going into a big spending year

Looking ahead to 2026, the UAE is placing its biggest bet on public spending. Cabinet approved the largest federal budget in the country’s history for 2026, with spending set to rise 29.2% y-o-y to AED 92.4 bn. This fiscal expansion aims to ensure the continuity of growth momentum amid diverging expectations from international institutions; while the CBUAE and BMI Research are optimistic that growth could hit 5.2%, Standard Chartered Bank adopts a more conservative view at 4%.

The federal inflation rate may accelerate in 2026 to 1.8%, according to estimates from the CBUAE, up from this year’s forecast of 1.3%. Other forecasts from the IMF, World Bank, Standard Chartered, and the ICAEW see inflation falling anywhere between 1.9-3%, while NBK thinks inflation could decelerate to below 2% in 2026 on the back of a slowdown in rental price growth in Dubai and a drop in food and fuel inflation.

The big question of 2026: How successful major projects such as the Etihad Rail network and the Unified GCC Tourist Visa will be in attracting sufficient investment flows to counter a potential acceleration of inflation.

Royal Development taps Tariq Nazzal as new CEO

Royal Development Holding promotes Nazzal to CEO: Tariq Nazzal (LinkedIn) has been promoted to CEO of Emirates Stallions Group’s Royal Development Holding, according to a press release. Nazzal was appointed general manager when the platform was launched.

Need a refresher? Emirates Stallions Group consolidated its real estate businesses under Royal Development Holding in June as part of a broader reorganization, creating a dedicated vehicle for its development and property assets.

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MEANWHILE- Kuwait’s DFM-listed Agility Public Warehousing Company’s (Makhazen) CEO Tarek Sultan (LinkedIn) has stepped down for personal reasons, according to a DFM disclosure (pdf). The board is set to convene to review the exit.

Equitativa names new board director: Equitativa, the manager of Emirates REIT, tapped Trevor McFarlane (LinkedIn) as the board’s new non-executive independent director, following Dubai Financial Services Authority approval, according to a Nasdaq disclosure.

Background: McFarlane brings with him substantial experience in geopolitical, macro-economic, financial, and regional policy analysis. He is also the founder and CEO of Emir, serves on the board of Binghatti Holding, and previously worked at The Economist.

FAB participates in Hong Kong’s RMB Business Facility + joins open finance framework

First Abu Dhabi Bank (FAB) is positioned as a primary architect for non-USD capital flows, following its participation in phase two of the Hong Kong Monetary Authority’s (HKMA) RMB Business Facility (RBF), which has doubled its RMB liquidity to RMB 100 bn and broadened the scope of what the money can be used for.

Catching up: The RBF was created by HKMA to replace the older trade-only facility with cheaper and more flexible funding. The transition occurs in two main steps: phase one lowers interest rates (matching Shanghai’s market rates), extends loan terms up to one year, and allows banks to send funds to their overseas branches for trade finance. Phase two expands the scope even further, allowing banks to use these funds for corporate capex and working capital loans, thus providing a stable source of RMB to support the broader “real economy” globally.

Why it matters for the UAE: This gives Emirati firms expanding into Asia a competitive advantage. By including FAB among the 40 participating banks, the HKMA is now giving the UAE’s largest lender direct access to offshore RMB to fund its clients’ capex and working capital.

Separately, FAB also rolled out the Open Finance service for retail customers, Gulf News reports. Partnering with fintech Pay10, the first fintech to be authorized under the Central Bank’s initiative, customers will be able to link their specific current and savings accounts to approved third-party financial services and make payments through the open finance network.

CBD did it first: Last week, the Commercial Bank of Dubai (CBD) became the first major bank to fully activate the Open Finance service to its retail customers, after the service had only been adopted by fintechs previously, effectively marking the end of a pilot period.

Beltone folds Chimera regional assets into its balance sheet in USD 1 acquisition

Egypt’s Beltone Holding is centralizing its regional footprint by absorbing a portfolio of UAE and Egyptian assets from its majority shareholder in a USD 1 transaction that signals an internal restructuring by Abu Dhabi-based investment firm Chimera, according to a disclosure (pdf) from Beltone. The Egyptian investment bank’s general assembly approved the acquisition of 100% of Lumen Aegis Enterprises from fellow Chimera-owned outfit EPointZero Limited, a move that effectively folds private regional holdings into Beltone’s publicly listed balance sheet.

DNI rating affirmed at A-

AM Best reaffirmed Dubai National Ins. and Reins.’s (DNI) financial strength rating and long-term issuer credit rating at A-, with a stable outlook, according to a press release.

Behind the results: The ratings came on the back of a robust balance sheet and strong operating performance, alongside limited exposure and disciplined risk management.

Private equity turns inward as continuation agreements hit record levels

Private equity is selling to itself at scale. Buyout firms routed a record share of exits through so-called continuation vehicles in 2025, as weak IPO markets and cautious buyers kept traditional sales out of reach, Financial Times reports.

About one in five PE exits this year used continuation structures, up from roughly 12-13% in 2024. Advisers estimate USD 100-107 bn of assets have moved through these vehicles in 2025 — an annual record — with even large, previously cautious managers such as EQT now planning to use the structure for select holdings.

This isn’t new. As we’ve previously noted, continuation agreements have been on the rise as IPO markets froze and other exit routes narrowed. While global IPOs saw a modest rebound in 9M 2025 — led by Saudi Arabia and other MENA countries — exits in the US and Europe remain patchy, keeping self-sales in play.

Why it works: Continuation agreements let managers return some capital without fully exiting, keeping exposure to assets they still back. One adviser called them a “popular and effective [triple-W] liquidity solution in a stressed exit environment,” with valuations still recovering from 2024 lows.

These vehicles can reset economics on ageing assets, creating fresh fee streams and extending performance upside at a time when full exits remain hard to execute.

Still, some pension funds remain uneasy about conflicts when firms act as both seller and buyer. Bain found nearly two-thirds of PE investors still prefer traditional exits — trade sales or IPOs — even as self-sales become more common.

MARKETS THIS MORNING-

2025 is ending on another mixed note for Asia-Pacific markets, which are broadly down in early trading. Hong Kong’s Hang Seng Index is down, while mainland China’s CSI 300 is beginning to trade up after as fresh data shows manufacturing activity in China rose for December — a first since March. Japan and South Korea’s markets are closed for the day. Wall Street looks set to open in the red, with futures trading down.

ADX	9,964	-1.0% (YTD: +5.8%)
DFM	6,015	-2.0% (YTD: +16.6%)
Nasdaq Dubai UAE20	4,833	-2.0% (YTD: +16.1%)
USD : AED CBUAE	Buy 3.67	Sell 3.67
EIBOR	3.5% o/n	3.5% 1 yr
TASI	10,382	-1.0% (YTD: -13.8%)
EGX30	41,690	-0.1% (YTD: +40.2%)
S&P 500	6,896	-0.1% (YTD: +17.3%)
FTSE 100	9,941	+0.8% (YTD: +21.6%)
Euro Stoxx 50	5,796	+0.8% (YTD: +18.4%)
Brent crude	USD 61.25	-0.1%
Natural gas (Nymex)	USD 3.94	-0.8%
Gold	USD 4,381	-0.1%
BTC	USD 88,236	+1.1% (YTD: -5.6%)
Chimera JP Morgan UAE Bond UCITS ETF	AED 3.84	+0.8% (YTD: +10.3%)
S&P MENA Bond & Sukuk	151.88	+0.1% (YTD: +8.5%)
VIX (Volatility Index)	14.33	+0.9% (YTD: -17.4%)

THE CLOSING BELL-

The ADX fell 1.0% yesterday on turnover of AED 8.9 bn. The index is up 5.8% YTD.

In the green: The National Bank of Ras Al Khaimah (+4.2%), Aram Group (+4.2%) and E7 Group Warrants (+4.0%).

In the red: Al Khaleej Investment (-7.6%), Orascom Construction (-6.3%) and Sudatel Telecommunications Group Company (-4.3%).

Over on the DFM, the index fell 2.0% on turnover of AED 608.7 mn. Meanwhile, Nasdaq Dubai was down 2.0%.

CALENDAR

2026

JANUARY

1 January (Thursday): New Year, public holiday.

1 January: Client asset regime changes in Dubai International Financial Center take effect.

1 January: Amendments to the Tax Procedures Law and the UAE VAT Law come into effect.

9-11 January (Friday-Sunday): 1 Bn Followers Summit, UAE.

11-12 January (Sunday-Monday): IRENA Assembly, Adnec Center, Abu Dhabi.

11-15 January (Sunday-Thursday): Abu Dhabi Sustainability Week, Adnec Center, Abu Dhabi.

11-15 January (Sunday-Thursday): ADSW Dialogues, Adnec Center, Abu Dhabi.

11-15 January (Sunday-Thursday): WiSER Forum, Adnec Center, Abu Dhabi.

12-15 January (Monday-Thursday): Dubai International Project Management Forum, Madinat Jumeirah, Dubai.

12-15 January (Monday-Thursday): SteelFab, Expo Center, Sharjah.

13-15 January (Tuesday-Thursday): World Future Energy Summit, Adnec Center, Abu Dhabi.

13-15 January (Tuesday-Thursday): FESPA Middle East, Dubai Exhibition Center, Dubai.

14 January (Wednesday): Global South Utilities Forum, Adnec Center, Abu Dhabi.

15 January (Thursday): Global Climate Finance Center Annual Meeting, Adnec Center, Abu Dhabi.

15 January (Thursday): Green Hydrogen Summit, Adnec Center, Abu Dhabi.

21-24 January (Wednesday-Saturday): Acres Real Estate Exhibition, Expo Center, Sharjah.

28-29 January (Wednesday-Thursday): IBA Arbitration Day Conference, Abu Dhabi.

28-30 January (Wednesday-Friday): World Customs Organization Technology Conference, Adnec Center, Abu Dhabi.

31 January – 7 February (Saturday-Saturday): Mubadala Abu Dhabi Open, International Tennis Center, Zayed Sports City.

FEBRUARY

3-5 February (Tuesday-Thursday): The World Governments Summit, Dubai.

4-6 February (Wednesday-Friday): Arab Actuarial Conference, Millennium Plaza Downtown Hotel, Dubai.

12-15 February (Thursday-Sunday): The Society for Incentive Travel Excellence Global Conference, Abu Dhabi.

9-12 February (Monday-Friday): World Health Expo (WHX), Dubai.

10-11 February (Tuesday-Wednesday): Top Advisors and Investors Summit, Abu Dhabi.

MARCH

31 March – 2 April (Tuesday-Thursday): Arab Media Summit, Dubai.

26-28 March (Thursday-Saturday): Social Capital Conference, Dubai.

28-29 March (Saturday-Sunday): Emirates International Congress on AI & Visionary Leadership in Transforming Healthcare, Adnec Center Abu Dhabi.

30 March – 2 April (Monday-Thursday): IAAPA Middle East Exhibition and Conference, Adnec Center, Abu Dhabi.

APRIL

7-9 April (Tuesday-Thursday): Future Health Summit, Adnec Center Abu Dhabi.

13-15 April (Monday-Wednesday): AIM Congress, Dubai World Trade Center.

13-15 April (Monday-Wednesday): The International Glass Manufacturing Show, Dubai.

14-16 April: (Tuesday-Thursday): the International Property Show, Sheikh Zayed Rd, Dubai.

21-23 April (Tuesday-Thursday): UITP Public Transport Summit, Dubai.

MAY

11-15 May (Monday-Friday): Dubai Future Finance Week, Dubai.

11-13 May (Monday-Wednesday): AI Everything Global, Adnec Center.

19-20 May (Tuesday-Wednesday): Capital Market Summit, Madinat Jumeirah, Dubai.

19-22 May (Tuesday-Friday): Abu Dhabi Water and Energy Week, Adnec Center, Abu Dhabi.

JUNE

15 June-15 September (Monday-Thursday): Dubai Mallathon, Dubai.

JULY

31 July (Friday): Large businesses achieving annual revenues equal to or above AED 50 mn must appoint an accredited service provider for e-invoicing implementation.

Signposted to happen sometime in October 2026:

Abu Dhabi Space Week, Abu Dhabi.

DECEMBER

2-4 December (Wednesday-Friday): UN Water Conference, UAE.

Signposted to happen in 2026:

The UAE to host the Arab Competition Forum;
Investopia Global Talks, Tashkent.

Signposted to happen sometime in 2027:

1 January: Deadline for large businesses to implement e-invoicing;
1Q 2027: Completion of the first phase of Hassyan seawater desalination project;
31 March: Small businesses with annual revenues of less than AED 50 mn are obliged to contract with an accredited service provider for e-invoicing implementation;
31 March: Government entities are required to appoint an accredited service provider for e-invoicing implementation;
1 July: Deadline for small businesses to implement e-invoicing;
1 October: Deadline for governments to implement e-invoicing;
Abu Dhabi’s solar and battery energy facility, combining 5.2 GW of solar capacity and 19 GWh of battery storage, is set for commissioning.

Signposted to happen sometime in 2029:

Sibos 2029 organized by the Society for Worldwide Interbank Financial Telecommunication (SWIFT), Dubai;
The commissioning of the seventh phase of Mohammed bin Rashid Al Maktoum Solar Park.

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