Good morning, friends, and welcome to the next-to-last workday of Ramadan. Like others across the Kingdom and the Muslim world, we’ll be looking skyward tomorrow evening to see the Shawwal crescent that signals the end of Ramadan and the beginning of Eid Al Fitr.

We have a meaty issue for you this morning before we send you off on vacation.

REMEMBER- Businesses will be off for Eid Al Fitr from Tuesday, 9 April, through Friday, 13 April, while banks and the stock market are from today and back on Sunday, 14 April..

PROGRAMMING NOTE- This is our only issue this week. EnterpriseAM Saudi will be off for the rest of the week for Eid — we look forward to being back in your inboxes before 7am on Sunday, 14 April. We hope you’re looking forward to a beautiful break with family and friends.

** Tap or click here to read this section with all of the links to our background stories as well as external sources.

WATCH THIS SPACE-

#1- IPO WATCH- Riyad Capital may be on the verge of an IPO: PIF-backed lender Riyad Bank is considering the listing of its investment banking arm Riyad Capital, the Kingdom’s third largest bank by assets said in a disclosure to Tadawu l. Both Riyad Bank and Riyad Capital will conduct “an assessment and preparation including determining the size, structure and the other relevant details of the IPO,” the disclosure read without providing further details. The transaction would also require regulatory approval.

The first spin-off of its kind: An IPO would see Riyad Capital operate as a distinct unit from its parent company, making Riyad Bank the first local lender to spin-off its investment banking unit.. EFG Hermes banking analyst Shabbir Malik tells Reuters he believes the bank is pushing with a plan to monetise a unit whose value is “not [clearly] reflected at the moment.”

Who owns what? The PIF owns a 21.8% stake in Riyad Bank, while the government holds a 10.4% stake.

#2- Saudi is launching a USD 3 bn vehicle to invest in industries across Iraq. Dubbed the Saudi-Iraq Investment Co, the company will pursue transactions in the “infrastructure, mining, agriculture, real estate development and financial services” sectors. The company, announced late yesterday, mirrors similar outfits set up to pursue investment in Egypt, Oman, Bahrain, Sudan, and Jordan.

In context: Saudi in February pledged USD 1.5 bn to help Iraq rebuild, including USD 1 bn in finance through the Saudi Fund for Development and another USD 500 mn in export credit.

#3- Saudi, GCC funds eye China’s distressed real estate sector: Gulf investment funds are in talks to acquire stakes in distressed Chinese real estate developers, Aleqtisadiah reported last week, citing sources close to the matter. Investors from Saudi, Qatar, and Kuwait are in advanced talks, the newspaper writes, saying the transactions could prove interesting entry points into the massive Chinese market.

Abu Dhabi sovereign wealth fund Mubadala and the Abu Dhabi Investment Authority are already there: They joined a consortium of investors led by Hong Kong-based private equity giant PAG in February for a USD 8.3 bn investment in the mall unit of Chinese property giant Dalian Wanda, taking a 60% stake.

BACKGROUND- The Chinese real estate sector has been hit by crises since the pandemic after a liquidity crunch triggered by a regulatory crackdown on high leverage among developers. Housing starts — a measure of new residential construction — fell by over 60% in comparison with pre-pandemic levels, with sales taking a hit on concerns that developers will not be able to complete projects due to a lack in funding, according to the IMF in February.

#4- STC Pay is turning into a digital bank: Saudi Telecom’s e-wallet business STC Pay received Saudi Central Bank (Sama) approval to transition into a digital bank and will brand itself as STC Bank, it said in a post on X last week. The beta launch will see a number of selected users’ digital wallets upgraded into a full-service bank accounts. STC Bank will offer Shariah-compliant banking services and solutions to its clients, with a full launch of the digital bank planned this year, according to the statement.

About STC Pay: Established in 2018, STC Pay became the first Sama-licensed fintech company, emerging to become the GCC’s largest e-wallet with 12 mn customers. It recently obtained Sama’s approval to turn into a digital bank.

#5- Aramco, and Shell are going head-to-head in negotiations for Temasek’s Pavilion Energy LNG assets, Reuters reported last week. The interest in the assets, which could bring in over USD 2 bn, comes as Aramco looks to increase its exposure to LNG after marking its entry into the business with a minority stake acquisition in MidOcean Energy last year. Aramco wants to boost its total natgas production by over 60% by 2030.

#6- Five investors were hit with SAR 44.9 mn in fines and orders for repayment after an appeals committee by the Capital Market Authority (CMA) upheld a finding they had engaged in insider trading in the listing of Watani Steel, the market watchdog said in a statement. The CMA said four of the investors executed a number of transactions before and after the listing of Watani Steel, raising their ownership in the steel producer without a required disclosure to Tadawul and shareholders. The fifth investor was also engaged in influencing the company’s share price on WhatsApp.

OIL WATCH-

Aramco has hiked the official selling price (OSP) of its flagship Arab Light crude oil to Asian buyers in May, Bloomberg reported on Friday, citing a price list it has seen. The oil giant raised OSP for Asian buyers by USD 0.3 to USD 2.00 premium to the Oman/Dubai average. The raise, which is the second consecutive for the grade, beat expectations of a USD 0.1 hike forecast by refiners and traders earlier. It comes amid tighter Middle Eastern crude markets, OPEC+ voluntary production cuts and an increased consumption by several producers in the region. Reuters also had coverage.

HAPPENING TODAY-

Pakistani PM Shehbaz Sharif is in town for talks with Crown Prince Mohammed bin Salman, the Pakistani Foreign Affairs Ministry said in a statement on Friday. This is Sharif’s first foreign visit since he was reelected PM in March.

REMEMBER- Saudi has been among key backers of the crisis-hit Pakistan, which is struggling from depleted foreign reserves. The Kingdom has extended the term of a USD 3 bn in deposit at the State Bank of Pakistan for an additional year, maturing in December this year. The country also received last year USD 2 bn in financial assistance from the Kingdom to shore up finances.

** So, when do we eat? Maghrib prayers are at 6:12pm in Riyadh and you have until 4:18 am to hydrate and caffeinate ahead of fajr.

WEATHER THIS WEEK-Look for a mix of showers and thunderstorms in the capital city through Wednesday evening.

DATA POINTS-

#1- Some 20 mn worshipers visited Madinah during the first three weeks of Ramadan, Arab News reported yesterday, citing official data.

#2- More than SAR 664 mn worth of zakat has been transferred through the Zakat, Tax and Customs Authority (Zatca)’s e-service Zakaty since its launch in 2017, Zatca said in a statement on Friday.

PSAs-

#1- Miners can apply to the Industry and Mineral Resources Ministry’s Exploration and Enablement Program (EEP) until 31 May, the ministry said in a post on X on Friday. The news comes after the ministry unveiled fresh incentives worth SAR 685 mn to boost mineral exploration here. The program is being rolled out in collaboration with the Investment Ministry and aims to reduce early-stage risk for exploration companies. Miners can apply through the Taadeen platform, with awardees set to be announced by the end of July this year.

#2- The Interior Ministry is rolling out a 50% reduction in traffic fines incurred before Thursday, 18 April, it said in a statement on X last week. It said motorists should pay accumulated fines within six months to benefit from the initiative.

#3- New rules for contracts with domestic workers: The Human Resources and Social Development Ministry has introduced a new initiative aimed at regulating contractual arrangements for domestic workers, it said in a statement last week. The new regulations center on termination of employment for staff who go AWOL within the the first two years of their arrival in Saudi.

SPORTS-

WHISPERS- Romelu Lukaku could be the latest addition to the Saudi Pro League: Chelsea FC Chairman and American bn’aire Todd Boehly has been in talks to sell the striker, currently on loan at Roma, to a Saudi Pro League club during the upcoming summer transfer window, according to Belgian reports picked up by Asharq Al Awsat. Boehly met with local officials in March in a bid to offload some Chelsea players to the Kingdom.

⚽ This weekend’s matches:

  • Damac vs. Al-Nassr (0-1);
  • Al-Khaleej vs. Al-Hilal (1-4);
  • Al-Ittihad vs. Al-Taawoun (0-0);
  • Al-Wehda vs. Al-Ahli(1-1);
  • Al-Tai vs. Al-Shabab (0-0);
  • Al-Ettifaq vs. Al-Riyadh (1-0).

Tonight’s matches (all scheduled for 9pm, not 10pm as has been the case throughout Ramadan):

  • Al-Raed vs. Al-Hazm;
  • Abha vs. Al Faleh;
  • Al Feiha vs. Al Akhdoud.

THE BIG STORY ABROAD-

The news cycle has pivoted on AI as coverage tilts further toward the “doomer” end of the spectrum — or, at the very least, becomes more critical of the technology. Two pieces worth your time:

#1- AI keeps going wrong. What if it can’t be fixed? in the Financial Times, wherein Henry Mance, the salmon-colored paper’s chief features writer, talks to critics who say that AI “is simply flawed.”

#2-How tech giants cut corners to harvest data for AI, in which the New York Times writes that OpenAI, Google, and Meta have “ignored corporate policies, altered their own rules and discussed skirting copyright law as they sought online information to train their newest artificial intelligence systems.”

The US presidential election is slowly heating up. The latest from the campaign trail came overnight, as President Joe Biden announced a USD 100 mn fundraising advantage over Donald Trump hours before Agent Orange was scheduled to hold a fundraiser. Biden is claiming the most cash on hand “of any Democratic candidate in history.”

Also making the rounds: The WSJ wonders where Tesla went wrong and whether it can “get its mojo back”.

AND- US, China agree to discuss working towards “balanced growth”: US Treasury Secretary Janet Yellen and Chinese Vice Premier He Lifeng agreed to hold “extensive exchanges on balanced growth in the domestic and global economies,” a Treasury statement said. The development comes as part of efforts to rebalance trade relations between the two and address US concerns about excess manufacturing capacity in China. Reuters has more.

WATCH THIS SPACE- A total eclipse of the sun will sweep across parts of North America tomorrow. Mns of people will see the midafternoon sky go dark as the moon passes between Earth and the sun.

CIRCLE YOUR CALENDAR-

The Gulf Film Festival (GFF) will open from Sunday, 14 April till Thursday, 18 April in Riyadh. Organized by the Film Commission in cooperation with the Gulf Cooperation Council (GCC) General Secretariat, the five-day event will showcase a selection of 29 films from across the region. It will also include three training workshops and six educational seminars focused on fostering artistic dialogue and raising awareness of cinema’s social impact.

Automechanika Riyadh will open on Tuesday, 30 April till Thursday, 2 May at the Riyadh International Convention and Exhibition Center. The annual trade fair will showcase the automotive industry’s latest advances and innovations.

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