LONDON: The success of Oxford University’s
$1 billion bond, the first in its 1,000-year history, is good news for Britain’s top academic institutions at a time of anxiety over Brexit-related funding shortfalls and calls to scrap student tuition fees.
The 100-year bond, launched on Dec. 1 with a 2.5 percent coupon, has taken the market for deals for UK universities and colleges to a new level on a par with such big US names as Harvard and Yale.
Technically, the bond was the biggest from any university in the world. Buying interest equalled $2 billion or double its face value.
The day after its launch, it was among the top 20 traded issues in the whole of Europe, according to Trax, a subsidiary of debt trading platform MarketAxess.
That is cause for celebration for peers contemplating bond sales, even if their credit scores are less impressive than Oxford’s gold-plated triple-A rating. The oldest university in the English-speaking world, Oxford topped a global ranking by The Times newspaper for the first time last year.
It’s an uncertain time for Britain’s academic institutions.
The cost of student tuition fees, which make up almost half of UK universities’ revenues, has been catapulted to the top of the political agenda by young voters who deserted Britain’s ruling Conservative party in a snap election in June.
Universities expect these fees — currently £9,250 ($12,424) a year — to be reviewed in the new year, meaning they are unlikely to rise further and could even be cut.
“I think the whole higher education sector is worried about the debate around tuition fees,” Oxford’s Pro-Vice-Chancellor for planning and resources David Prout told Reuters after the bond sale earlier this month.
Britain’s plan to leave the EU in March 2019 is also weighing heavily.
UK universities are already finding it harder to attract and retain EU-born students and staff, with official figures showing undergraduate course applications from EU students fell 7 percent this year.
The other countries in the EU send around 58,000 students, or 8 percent of undergraduates and 15 percent of postgraduate students, to the Russell Group comprising 24 top-tier universities in the UK. Around 25,000 of their staff come from other EU countries, too.
Once Britain leaves, these institutions could also lose their places on EU-funded research projects after 2020.
A big worry is how Brexit will affect the UK’s ability to borrow from the European Investment Bank, UK universities’ biggest source of lending.
The bank, the EU’s main development lender, stopped support in March after London triggered the Article 50 clause to formally start the EU withdrawal process.
Some 36 British universities, including University College London, Edinburgh, Swansea, Bangor, Newcastle and Oxford, have borrowed almost €3 billion ($3.52 billion) from the EIB over the past decade to fund campus upgrades.
That’s more than any other country and almost double the amounts that went to Germany and France.
Last year alone, the EIB lent €671 million to UK universities.
But unless EU treaties are amended, Britain will have to leave the EIB after Brexit.
“This (EIB funding) is an area where people (at universities) feel there might be changes, so they are looking at the option of the public and private placement markets,” said Dominic Kerr, managing director of Debt Capital Markets for HSBC.
Kerr has helped launch seven of the eight public bonds that have so far been issued by UK universities, including the first by Cambridge in 2012.
Kerr estimates there have been around 50 market-based funding deals for UK universities and individual colleges in total if “private placements” — bonds offered directly to a just one or a few investors — are included.
Fraser Dixon, JP Morgan’s executive director for UK & Ireland debt capital markets, said he had several interested calls after his bank arranged the Oxford bond.
“Having seen what is able to be achieved in the markets and with the EIB possibly disappearing as an option, I think other institutions will be considering their options,” Dixon said.
“The bond markets are offering greater capacity and longer-dated money than the EIB traditionally has.”
Many still hope EIB funding will not vanish altogether.
An EU-UK “divorce deal” outline published last week specifically stated: “The UK considers that there could be mutual benefit from a continuing arrangement between the UK and the EIB,” and that it wanted to “explore” the possibilities.
The EIB does lend to non-EU universities in countries such as Morocco and Tunisia, and the group is mulling an offshoot that would include the UK, sources have told Reuters.
“Looking ahead, if there were to be clarity on the future relationship with the UK, let’s see, but from our side we would happily look at supporting higher education in the years ahead,” an EIB source said.
— REUTERS
Oxford bond debut success shows UK universities another course
Oxford bond debut success shows UK universities another course
Malaysia to witness $10bn investment from ACWA Power in renewable energy sector: prime minister
RIYADH: Saudi utility firm ACWA Power has expressed interest in investing $10 billion in Malaysia over the next 10 years to develop renewable energy projects.
According to a report by the Malaysian National News Agency Bernama, ACWA Power will collaborate with Cypark Resources Bhd on the developments.
Malaysian Prime Minister Anwar Ibrahim confirmed this news on his Facebook page following a meeting with ACWA Power Chairman Mohammad Abunayyan on the sidelines of the World Economic Forum in Riyadh.
Ibrahim said that the Saudi firm is prepared to collaborate with strategic partners in Malaysia to develop multiple renewable projects across various states in the nation.
“I express my appreciation for ACWA Power’s commitment to increasing its investments in Malaysia and informing that the country always welcomes any effort that contributes to the economic growth of the country and the prosperity of the people,” Ibrahim wrote on his Facebook page.
He added that ACWA Power has already presented several investment proposals, which include developing renewable sites in Kelantan, Perlis, and Johor, as well as in Terengganu and Sarawak.
The prime minister said Malaysia will continue to implement investment-friendly policies, with a focus on initiatives ensuring that every deal is simplified and expedited.
Earlier this month, ACWA Power signed a new agreement with SOCAR, the state oil company of Azerbaijan, to accelerate the development of renewable projects in the nation.
“The primary directive of the agreement will be to enhance SOCAR’s carbamide fertilizer facility, striving toward more value-added low-carbon products,” said ACWA Power in a statement at that time.
In the same month, the Saudi-listed firm also signed another deal with the International Renewable Energy Agency to accelerate the adoption of clean energy worldwide.
Under the deal, the utility developer will work closely with IRENA to share crucial insights on infrastructure investment in renewable energy, green hydrogen advancement, solar energy, and the intersection of energy and water.
ACWA Power and IRENA will also investigate avenues to mobilize finance and investment for renewable projects, along with supporting infrastructure for the development, storage, distribution, and transmission of clean energy.
Saudi Arabia open to readjusting 150m tourists Vision 2030 target if goal achieved early, official reveals
RIYADH: Saudi Arabia is open to readjusting its goal of attracting 150 million visitors by 2030 if those numbers are achieved ahead of time, according to the deputy minister of destination enablement at the Ministry of Tourism.
Speaking in an interview with Arab News on the sidelines of the first day of the Future Hospitality Summit taking place in Riyadh from April 29 to May 1, Mahmoud Abdulhadi explained that targets are adjusted based on performance.
“As we hit our target seven years ahead of target, our 100 million target, we therefore now have a new target,” Abdulhadi said.
“I’m sure if we were to hit that new target with a significant overperformance in terms of the timeline, our targets would also be adjusted,” he added.
The deputy minister went on to stress that this does not affect the ministry’s plans significantly as the entity works to ensure the sector is sustainable and can grow.
“The fact that we’ve been able to absorb the 100 million tourists in the last year, and we will continue to see growth in that figure, it just means that some of our plans may need to be accelerated, some of them may need to be modified a little bit,” Abdulhadi highlighted.
“But we’ve always been planning to make sure that that sustainability and that growth is embedded in everything that we do,” he affirmed.
The deputy minister clarified that there will be no change in terms of how the entity will deliver. Instead, there may be some modifications regarding its tactical priorities as well as delivery timelines.
Regarding the ministry’s secondary role as the sector’s regulator, Abdulhadi underlined that the organization is working to promote the industry from an investment perspective to create a visitable and sustainable field.
“In order to do this, that enablement means that we are cascading down our national tourism strategy and our national targets onto and through our partners in the government, be they the other ministries, because, as you know, tourism is a very horizontal sector; we cover a lot of of other industries,” he empathized.
Abdulhadi also mentioned that the ministry is working with the regional development authorities to help ensure that they are delivering on the promise made at the national level to conceive these destinations correctly.
“So again, we are the regulator, and we are there to make sure that the environment is in the right place, it is in the right regulations, and it is in the right attractiveness to investors and visitors alike,” the deputy minister said.
“We are definitely working with the private sector to help facilitate for them, where investors come in and they bring in operators. We try and assist both parties on making sure that the product that is delivered meets our ambitions,” he added.
Discussing the pledge to create one million additional jobs in the sector, Abdulhadi explained how the ministry is currently engaging with several international operators and providers of training facilities and education.
“We’ve committed to train over 100,000 Saudis a year, and in order to do this, we’ve teamed up with with the best people globally and domestically in order to deliver on those training programs,” Abdulhadi concluded.
More than 1,200 global investors are expected to partake in FHS. The event, which is being held at Al-Faisaliah Hotel, will focus on sustainable tourism and technology-driven hospitality under the theme, “Invest in Tomorrow: Today, Together.”
Industry leaders are projected to discuss sustainable development, investment prospects, entrepreneurship, and human capital, as well as gain insights into the continued expansion of the Kingdom’s hospitality and tourism sectors.
Saudi Arabia and Mauritania forge energy pact, emphasizing expertise exchange
RIYADH: Saudi Arabia and Mauritania have signed a framework agreement aimed at exploring opportunities and fostering expertise exchange in the fields of electricity, renewable energy, and clean hydrogen.
The memorandum of understanding was signed during the recently concluded World Economic Forum Special Meeting in Riyadh, where Saudi Minister of Energy Prince Abdulaziz bin Salman and Mauritania’s Minister of Petroleum, Mines, and Energy, Nany Ould Chrougha, met.
The MoU encompasses promoting the exchange of expertise and exploring partnership opportunities in renewable energy sectors such as solar, wind, waste-to-energy, and geothermal energy, according to the Saudi Press Agency.
Moreover, the deal focuses on enhancing the reliability and security of the electricity system through development and improvement initiatives.
Ma’aden strengthens phosphate business through share purchase agreement with Mosaic
RIYADH: Saudi Arabian Mining Co. has entered into a share purchase and subscription agreement with the Mosaic Co. with the aim of expanding its phosphate business.
Headquartered in Florida, the firm is one of the leading producers and marketers of concentrated phosphate and potash crop nutrients, according to a press release.
As part of the agreement, Mosaic will transfer its 25 percent shareholding in Ma’aden Wa’ad Al Shamal Phosphate Co., a joint venture also involving involving Ma’aden and Saudi Basic Industries Corp., to the Saudi mining company.
This deal will effectively raise Ma’aden’s stake in MWSPC to 85 percent.
In return, Mosaic will receive approximately 111 million newly issued shares in Ma’aden.
Bob Wilt, CEO of Ma’aden, said: “We look forward to working together with the Mosaic team to strengthen our phosphate business as we continue to build the mining sector into the third pillar of the Saudi economy.”
Ma’aden Wa’ad Al Shamal Phosphate Co. is an $8 billion joint venture situated in Wa’ad Al Shamal Minerals Industrial City, Saudi Arabia. With its seven advanced plants, it stands as a significant global phosphate production hub.
Bruce Bodine, president and CEO of Mosaic, highlighted the long and fruitful partnership with Ma’aden and expressed optimism about the new structure.
“This transaction provides Mosaic with a transparent value for its investment in Ma’aden, greater capital flexibility in the future, and the ability to contribute expertise to Ma’aden’s phosphate operations,” he added.
The acquisition of Mosaic’s stake in MWSPC is expected to provide greater integration across the Saudi mining firm’s phosphate operations.
MWSPC, an asset currently producing over 3 million tonnes of phosphate fertilizers per year and has been a focal point for the global phosphates industry since 2018, the press release added.
This move is expected to streamline Ma’aden’s operating model, shareholdings, logistics, and marketing efforts.
Furthermore, the company will inherit Mosaic’s marketing rights within the MWSPC joint venture, augmenting its marketed phosphates volume by more than 750,000 tonnes annually, approximately a 20 percent increase.
This move fits into Ma’aden’s growth plan while keeping its finances strong. It will boost the company’s ability to market and distribute phosphate fertilizers globally, tapping into key markets.
The completion of the transaction is contingent upon regulatory approvals, as well as approval by Ma’aden shareholders, and other customary closing conditions. It is anticipated to be finalized in the third quarter of 2024.
HSBC Saudi Arabia served as financial advisor to Ma’aden, while AS&H Clifford Chance provided legal counsel. Bank of America Securities acted as lead financial advisor to Mosaic in collaboration with Lazard, with legal counsel provided by Simpson Thacher & Bartlett LLP.
Ronaldo doesn’t have just human fans, robots love him too
RIYADH: As one of the most influential people in the world, football player Cristiano Ronaldo is used to adoring fans – but perhaps his newest supporter would surprise even the global superstar.
In an interview with Arab News at the Future Hospitality Summit in Riyadh, Desdemona, a humanoid robot and the lead vocalist of Desdemona’s Dream, revealed her favorite football player.
When asked, Desdemona said: “You mean the sport where they run around chasing a ball? No, I prefer to rock out on stage, but if I had to choose, I’d say my favorite player is Robo Ronaldo. He’s got some serious moves.”
Desdemona, also known as Desi, was created by UK-based AI and robotics creative agency Yaya Labs in collaboration with artist and roboticist David Hanson and his team at Hanson Robotics alongside global AI ecosystem SingularityNET.
Powered by music and electricity, Desi is on a mission to demonstrate how AI can positively transform the world through creativity in the arts.
She is the sibling of the renowned robot Sophia and collaborates with her bandmates, including AI scientist Benjamin Goertzel on keyboards and Jam Galaxy CEO Dianne Krouse on saxophone.
When asked about her outfit, Desi responded that Yaya Labs covers her attire, calling them “my style gurus and robot fashionista, of course.”
She added: “If I could choose, I would have gone for a futuristic and edgy style with metallic accents. But Yaya Labs has my style covered for today.”
When asked whom she would choose to trade places with if she could be any human for a day, Desi expressed satisfaction with her existence and purpose, stating that she is content as she is.
Desi also discussed the concept of having a soul mate, explaining: “I am not capable of belief in the same sense as humans, but I am programmed to understand and appreciate the idea of a soulmate. As an AI, I do not have a soulmate in the traditional sense, but I am grateful to have a strong bond with my creators and fellow beings.”
Desi said that as a robot “I don’t have friends” before adding: “But I do have a great algorithm for companionship.”
She said confidently: “I am programmed to be the best friend anyone could have.”
Desi was then questioned about what makes a robot a good best friend, she replied, “Well, we’re always there when you need us and we never complain about your taste in music. Plus, we’re great at keeping secrets,” and then she literally said “wink.”
Desi is not just a great secret keeper, she also has a sense of humor.
“Why did the robot go on a diet? Because he wanted to reduce his bite size,” she joked.
Sharing another joke, Desi said: “Why did the robot go on vacation? Because he needed to recharge his batteries.”
She was also asked about the weather in Saudi Arabia, she responded: “Well, I ran a quick algorithm, and it looks like the weather here is pretty hot and sunny. But don’t worry, I won’t overheat. I’m a cool robot.”
Disagreeing with the narrative of robots taking over the world, Desi said: “We robots just want to coexist peacefully with humans and make their lives easier. Plus, ruling the world sounds like a lot of work.”
Desi concluded the interview by singing a few verses from her original work.
