COVID-19

GulfNews Business

UAE reports modest gains in non-oil economy in February

Business|: Dubai: The UAE’s purchasing managers' index (PMI) data for February showed a modest increase in non-oil private sector output with improved business expectations. However, the underlying data indicated fresh disruptions to the UAE non-oil private sector in February, as rising coronavirus disease (COVID-19) cases led to increased restrictions in parts of the economy and hampered customer sales. The headline index fell from 51.2 in January to 50.6 in February to indicate a slower and only marginal improvement in business conditions. The index stayed above the 50 neutral threshold largely due to the output sub-component, which continued to signal a rise in business activity in the UAE non-oil economy. New business failed to rise for the first time in four months, contributing to just a modest rise in output and a broadly unchanged employment level. "The tightening of COVID-19 restrictions in February had a notable impact on the UAE economy, according to PMI survey data. New orders failed to grow for the first time since last October, while output growth softened since the start of the year,” said David Owen, Economist at IHS Markit. Improved expectations Business expectations improved, but only gradually as restrictions led to further uncertainty about short-term growth prospects despite hopes for a rebound in the latter half of 2021. Firms also signalled that global supply chain delays impacted on the UAE economy in February, as lead times on inputs lengthened at the fastest rate since last April. However, the impact on costs has so far been limited, allowing companies to continue offering discounts on sales. Stable employment Employment numbers were largely stable in February, as unchanged sales volumes meant that companies saw little pressure on capacity and were able to lower backlogs for the sixth month running. Subdued jobs trends were also linked to expectations for output in the next 12 months which, despite improving to a five-month high, remained historically weak. Many firms said that new restrictions made the near-term outlook more uncertain, although the rapid rollout of COVID-19 vaccines and projected new business gains from the Expo 2020 meant that firms were generally optimistic of an improvement in the economy later in the year.

GulfNews Business

Mideast Spotify challenger Anghami near SPAC merger

Business|: Dubai: Music streaming service Anghami is close to being listed on the Nasdaq stock exchange in New York by merging with a blank-check company, according to people familiar with the matter, setting the stage for one of the biggest investments into a Middle Eastern technology startup in years. Anghami, Arabic for "my tunes," has been holding talks with Vistas Media Acquisition Company Inc., a special purpose acquisition company set up last year, and a deal may be announced as early as Wednesday, the people said, asking not to be named because the information is private. It would mark the first listing on the Nasdaq in New York by a home-grown Middle Eastern tech company. High valuation If the deal goes ahead, Anghami could be valued at close to $300 million, according to the people. The transaction includes a combined $40 million commitment from UAE financial firm Shuaa Capital and the parent of the SPAC sponsor in so-called PIPE - private investment in public equity - financing, the people said. SPACs are often formed to allow private companies to raise fresh funds to grow and list directly without having to go through the costly and time-consuming initial public offering process. Representatives for Anghami, Vistas and Shuaa declined to comment. A successful listing of Anghami would add to a streak of major technology deals in the Middle East that started with acquisitions of local companies by Uber Technologies Inc. and Amazon.com Inc. Despite the shockwaves of the coronavirus pandemic, regional startups have attracted around $1 billion in funding in 2020, 13% more than the previous year, according to Dubai-based Magnitt Inc. New Arrival Anghami relocated its headquarters from Lebanon to the capital of the United Arab Emirates at the start of this year in partnership with the Abu Dhabi Investment Office. It was a coup for Abu Dhabi, which has been courting tech companies and startups as part of its efforts to diversify the oil-dependent economy. Anghami, founded in Beirut in 2012 by two Lebanese entrepreneurs, has grown to become one of the region's most popular streaming platforms. It delivers about 1 billion streams per month, offering 57 million songs to more than 70 million registered users. With offices across the Arab world, Anghami is vying for regional hegemony with Spotify Technology SA and Deezer SA. Key shareholders Anghami's shareholders include regional venture capital firms and strategic shareholders, such as Middle East Venture Partners, Samena Capital, Emirates Integrated Telecommunications Co., MBC Group and Etihad Etisalat Co. who represent around 68% of the company with the rest owned by the founders. VMAC is led by Chief Executive Officer F. Jacob Cherian, a former associate at JPMorgan Chase & Co., and co-founders Abhayanand Singh, the head of the Singapore-based media investment company behind the SPAC, and Saurabh Gupta, a former banker and co-producer of several films. Vistas began trading on the Nasdaq stock exchange in August after its $100 million IPO. Anghami last year worked with investment bank JPMorgan to raise fresh capital and explore strategic options as it looked to expand, sources told Bloomberg at the time. More recently, Shuaa Capital also invested in the music platform.