What we’re tracking on 14 March 2021
Good afternoon, everyone. We begin the week with a continued flurry of M&A news, which looks set to dominate domestic business news for another week.
The blockbuster news involves much-needed foreign investment as the UAE’s Aldar properties said it was looking to acquire a controlling stake in upmarket real estate developer Sodic.
Meanwhile, on an M&A that once was, GlaxoSmithKline appears to be rethinking plans to exit Egypt after talks with Hikma over the latter acquiring its Egypt assets broke down (which we covered in EnterpriseAM this morning). Acdima, meanwhile, says it wants to start due diligence on GSK’s Egypt arm.
And the bidding war for Alexandria Medical Services appears to be heating up with a consortium that includes Tana Africa Capital looking to buy 100% of the hospital operator.
M&A in the investment management industry hit last year its highest level since the 2008 financial crisis as intense competitive pressure spurs more consolidation, the Financial Times reports. Total M&A involving asset and wealth managers nearly tripled, rising to USD 38.9 bn in 2020 from USD 13.6 bn the year before. Nine transactions had pricetags exceeding USD 1 bn, including Morgan Stanley’s USD 7 bn acquisition of Eaton Vance and Franklin Templeton’s USD 4.5 bn buyout of Legg Mason.
Look for more of the same in the year to come: The gaping size difference between the biggest players and the rest of the pack will see “the largest asset managers … continue to hunt for acquisitions to ‘leverage their scale’ to boost revenues and cost savings,” while smaller players will be open to M&A because of the “immense challenges” of going head-to-head with the big fish, the salmon-colored paper writes.
CATCH UP QUICK on the top stories from today’s issue of EnterpriseAM:
- The third wave of the pandemic appears to be on our doorstep — and it could accelerate as Ramdan arrives.
- All 12 analysts in our interest rate poll see the central bank leaving rates on hold when it meets on Thursday.
- Banque Misr will take 90% of CI Capital, but the firm will remain listed on the EGX.
HAPPENING NOW- The House of Representatives is discussing proposed changes to the Bankruptcy Act in an ongoing plenary session. The changes — which gives creditors more a greater say in deciding the future of bankrupt businesses and give more avenues for struggling borrowers to settle with lenders before filing for bankruptcy, among other things — are now in their final stages after having been finalized at committee-level earlier this year.
MPs were back to plenary sessions today after going on recess earlier this month. On the agenda:
- A EGP 2 bn overdraft for the FY2020-2021 state budget is up for discussion in today’s plenary session;
- The general assembly will also look at the Water Resources Act tomorrow;
- The House Economic Committee is set to resume discussing the Sovereign Sukuk Act today;
- The Central Agency for Organization and Administration’s plan for informal laborers is also up for discussion at the House Manpower Committee today.
THE BIG BUSINESS STORY ABROAD- A US federal judge ordered a temporary halt on the US investment ban on Xiaomi, with a complete reversal likely to follow, the WSJ reports. The ruling casts more doubt on the Trump-era Pentagon decision in January to add consumer electronics giant Xiaomi to a list of companies it believes are linked to the Chinese military, effectively blacklisting it from US investment. This comes just after US President Joe Biden in February paused legal action taken by the Trump administration against Tiktok and WeChat, while his administration revisits whether the apps really pose a threat. The Department of Defense had cited an award given to Xiaomi founder in 2019 by the Chinese state, and the company’s ambitions in 5G and artificial intelligence technology, as grounds for the ban, which the judge called “deeply flawed” as some 500 entrepreneurs had received similar awards while 5G and AI are “becoming industry standards for consumer electronics devices.”
🗓 CIRCLE YOUR CALENDAR-
Photopia’s Cairo Photo Week 2021 is up and running until 20 March. The photo festival will feature over 100 activities including workshops, panels, photo challenges, exhibitions, portfolio reviews and photo walks throughout the week, all led by more than 80 local and international photographers. You can check out the event program on Photopia’s website, there’s plenty to look at on the group’s Instagram feed @cairophotoweek, and both physical and virtual tickets are available here.
A masterclass on advanced color grading is taking place today at 5-9pm. Taught by Menna Hossam (Behance), participants will learn how to transform images into mystical art pieces. All you need is to bring a laptop with Photoshop installed on it.
Talking sustainable manufacturing with BEBA: The British-Egyptian Business Association (BEBA) will host a virtual conference on how Egyptian and UK firms can work together on sustainable manufacturing projects in Africa in the post-Brexit environment on Tuesday, 23 March. Check out the agenda here (pdf).
AUC Press’s Mad March book sale will be ongoing for the rest of the month. The sale is open to the general public every day from 10am–6pm CLT at AUC Tahrir Bookstore & Garden.
🚙 FOR YOUR COMMUTE-
The pandemic-induced baby drought is hurting the global economy as major economies report dwindling birth rates, raising concerns that the supply of future taxpayers to service the enormous debt incurred to fund economic aid and public pension systems is looking even thinner than before, Bloomberg reports. Within two decades, 10-15% fewer adults may join the workforce as a result, experts tell the publication, and it's going to lower potential growth rates and make debt less sustainable in the long term. This issue is pronounced in certain countries in Asia and Europe with aging populations. France reported its lowest birth rate since World War II, 15 Italian cities reported 22% fewer births, while Chinese authorities saw a 15% decline in registered newborns in 2020.
US regulators are cracking down on Tesla and other automakers who test unfinished driverless tech on users: The National Transportation Safety Board (NTSB) is calling for stronger federal requirements on the design and usage of automated driving technologies on public roads, NTSB chief Robert Sumwalt said in a letter to its sister agency, the National Highway Traffic Safety Administration (NHTSA) which enforced recalls of vehicles. Tesla has been testing its Level 2 Autopilot system — which means vehicles have some automated functions, but require drivers to remain attentive and keep their hands on the wheel — in its cars “with limited oversight or reporting requirements” said Sumwalt.
📺 ON THE TUBE TONIGHT-
(All times in CLT)
Netflix original series The One has been released today. Based on a novel by John Marrs, the series follows a dating company known as The One that uses DNA analysis to match you to the love of your life in a show combining relationship drama and murder mystery set in a futuristic world. Decider is a fan while CNN gave it a shrug.
The follow-up to 1988's Coming to America, Coming 2 America (see what they did there?) has been released on Amazon Prime. In the comedy film, Eddie Murphy and Arsenio Hall team up to help the soon-to-be-King of Zamunda who returns to America to find the son he never knew he had. You can check out these reviews by the New York Times and the Los Angeles Times.
It’s another Super Sunday in the English Premier League: Southampton and Brighton kicked off at 2pm in the first game of the day and the score now stands at 2-1 in favor of Brighton. Meanwhile, Leicester and Sheffield United will kick off their match soon at 4pm.
The biggest games of the day are being saved for last: London arch rivals Tottenham and Arsenal face off at The Emirates at 6:30pm before Man Utd and West Ham meet each other at 9:15pm in a six-pointer in the race for the top four.
Serie A action is also about to get under way, with Torino going up against Inter Milan and Parma playing Roma, both at 4pm. Later in the day, underfiring Juventus will go head-to-head with relegation-threatened Cagliari at 7pm and AC Milan will kick off against Napoli at 9:45pm.
Celta Vigo and Athletic Club have just kicked off their mid-table clash in La Liga, while Granada and Real Sociedad will play at 5:15pm, Eibar versus Villareal at 7:30pm, and Sevilla versus Real Betis at 10pm.
Here at home: Al Mokawloon are currently playing against Ghazl El Mahalla in the Egyptian Premier League.
☕ DRINK THIS TOMORROW-
A coffee subscription sounds pretty good to us right about now. TBS has launched My TBS Cup — a EGP 299 monthly subscription that will give you two coffees a day. Of course, even without the subscription, TBS is a great place to get something quick to eat on the go, from their bakery section to their ‘make a sandwich’ counter. We love their blueberry muffins and their mini pizzas. Meanwhile, you’ll really be upping your sandwich game if you add their pesto or caramelized onions to your sandwich. And as Ramadan nears, we’re awaiting their yearly innovative creations, but their already existing Butler Box is a great hit at any suhoor.
🎤 OUT AND ABOUT-
(All times in CLT)
The Comedy Bunch are at The Room Art Space in New Cairo tonight at 9pm. The event will be hosted by Ahmed El Hareedy and feature comedians Abdelrahman Ahmed, Yara Fahmy, Khalid Elshoky, and Koala Sandwich Live.
Brush It is organizing a Pottery, Paint, and Sip night on Tuesday at 6-8pm at Ora Restobar in New Cairo. All participants will be given a large plant pot to paint as well as all the necessary equipment — and of course something to sip. Bring your creativity and join the paint party by registering online here.
💡 UNDER THE LAMPLIGHT-
Environmental catastrophe from the perspective of those affected: Despite the amount of attention we give to environmental issues, it’s still hard to understand the real-life consequences of pollution from the perspective of those that are most heavily impacted. How Beautiful We Were by Imbolo Mbue is a novel set in the fictional African village of Kosawa, and tells of a people living in fear amid environmental degradation wrought by an American oil company. From pipeline spill and toxic drinking water, the novel explores what happens when the reckless drive for profit, coupled with the ghost of colonialism, threatens a community’s livelihood and safety.
🌤 TOMORROW’S WEATHER- We’re not sure whether we should have our summer or winter clothes hung in the closet. Tomorrow’s weather will see daytime highs of 28℃ and nighttime lows of 13℃, our favorite weather app tells us. The meter will dip down to 24℃ on Tuesday and Wednesday then gradually increase to 31℃ on Saturday and Sunday.