LONDON: Vodafone Chief Executive Vittorio Colao will step down in October after 10 years in which the Italian reshaped the world’s second largest mobile operator into a digital communications powerhouse with a string of major deals.
The urbane Colao will be replaced by Nick Read, finance director since 2014 and long seen as his successor due to his previous roles running Vodafone’s operations around the world.
He will take charge of a group that, under Colao, pulled back from its once brazen expansionist drive, most notably when it sold out of the United States with a $130 billion exit from a joint venture with Verizon.
Last week Vodafone struck a long-expected $21.8 billion deal to buy Liberty Global’s cable TV and broadband networks in Germany and Eastern Europe, the latest move to strengthen its European business.
And in India, which it entered with great fanfare in 2007, it is merging its operations with Idea Cellular to bulk up in a market that has been hit by intense competition.
“Today Vodafone is at a natural juncture, the strategic 10 -year reshaping of the group is now nearing completion,” Colao, 56, told reporters. “Nick has been the core architect of Vodafone strategy for much of my tenure.”
Analysts said the timing of the departure should come as no surprise and that investors should be reassured by Read’s appointment. The change came as the group published solid 2018 results and a more cautious 2019 outlook.
Shares in Vodafone fell almost 4 percent on the news.
“With the Liberty deal announced and India set to close, he leaves behind a strategically well-positioned portfolio for his successor Nick Read, who we think is a safe pair of hands,” analysts at Bernstein said.
End of an era
In Read, 53, investors will get a new chief executive long groomed for the job.
Read said he had been alongside Colao through the process of reshaping Vodafone, and he would now deliver the benefits for shareholders and customers.
“I think now is the time to really focus on our organic plan, really focusing on digital transformation of our business and the customer experience,” he told reporters.
“And of course there’s a big opportunity of integrating these new businesses, both Liberty and over in India.”
Having joined Vodafone in 2001, Read’s roles have included running the British and emerging market operations. He has also sat on the boards of the company’s listed operations in Africa and Qatar, its subsidiaries in India and Egypt and its joint venture in Australia.
Read will be replaced by his deputy since 2015, Margherita Della Valle. The Italian joined Omnitel Pronto Italia — which later became Vodafone Italy — in 1994.
The announcement came as the company reported a 1.4 percent rise in organic service revenue for its fourth quarter, beating analyst forecasts of a 1.1 percent rise.
Full year core earnings rose 11.8 percent to 14.7 billion euros, beating guidance for “around 10 percent” organic growth and just ahead of analyst forecasts of 14.6 billion euros.
For 2019, the group forecast a more cautious organic adjusted core earnings growth of between 1 and 5 percent, and free cash flow before spectrum costs of at least 5.2 billion euros, slightly down on the 2018 number of 5.4 billion euros.
Work to do
Chairman Gerard Kleisterlee said Colao had been an “exemplary leader and strategic visionary who has overseen a dramatic transformation of Vodafone.”
Born in northern Italy, Colao cut his teeth as a management consultant at McKinsey before he joined Omnitel in 1996.
A keen cyclist, the tall Colao has lived a quiet life in London, largely avoiding London’s corporate social scene.
Colleagues say he enjoys the cut and thrust of talking to journalists and will also happily discuss European politics. Analysts have speculated that he could move into Italian politics.
His departure follows that of Martin Sorrell at WPP after 33 years in charge, meaning the FTSE 100 has lost two of its longest-serving CEOs in a short period of time.
“It has a been a real privilege to lead the group through a decade of massive strategic transformation culminating in today’s good financial performance,” Colao told reporters.
“But it is not yet the time for goodbyes. There is still a lot to do between now and October.”
End of an era as Vodafone boss Colao makes way for protege Read
End of an era as Vodafone boss Colao makes way for protege Read
- Last week Vodafone struck a long-expected $21.8 billion deal to buy Liberty Global’s cable TV and broadband networks in Germany and Eastern Europe
- The urbane Colao will be replaced by Nick Read, finance director since 2014 and long seen as his successor due to his previous roles running Vodafone’s operations around the world
Saudi authorities plan to boost assets under management to 29.4% of GDP in 2024
- Capital Market Authority plans to accelerate the pace of listings by welcoming 24 new companies
RIYADH: Saudi Arabia aims to enhance its stock exchange appeal to foreign investors, targeting 17 percent ownership of free float shares by 2024, a new report has revealed.
According to the 2023 Financial Sector Development Program document, the Saudi Capital Market Authority plans to boost assets under management to 29.4 percent of gross domestic product in 2024 by increasing the investment environment and attracting more investors.
The report, published annually, highlights the achievements in the financial sector, particularly the Kingdom’s ongoing progress in competitiveness indicators related to the capital market, as stated by Mohammed Al-Jadaan, minister of finance and chairman of the FSDP.
Commenting on the development of the financial sector, Al-Jadaan emphasized the importance of innovation and investment in talent and technology.
“We have placed innovation and investment in both talent and technology at the top of our priorities, because we recognize the importance of building a dynamic financial environment that allows companies — especially startups — to flourish and succeed,” the minister stated.
In line with its commitment to facilitating financing in the capital market, the CMA also plans to accelerate the pace of listings by welcoming 24 new companies in 2024.
Moreover, there will be a focus on supporting the development of new and promising sectors, with a target of having micro and small enterprises account for 45 percent of total listings.
Another area of emphasis is the deepening of the sukuk and debt instruments market, with the goal of increasing the debt-to-GDP ratio to 22.1 percent by the end of 2024. These measures aim to provide diverse financing options for companies and further stimulate economic growth.
“The capital market ecosystem continued its efforts to contribute to developing the financial sector and achieving the Saudi Vision 2030,” stated Mohammed El-Kuwaiz, chairman of the CMA.
“By approving rules for foreign investment in securities and streamlining regulatory procedures, we have witnessed a significant increase in foreign investments in the capital market, reaching SR401 billion ($106.9 billion),” El-Kuwaiz added.
The Saudi Central Bank also reaffirmed its commitment to adhering to international standards and best practices to enhance the strength and stability of the financial sector.
Initiatives such as developing digital solutions for supervising the financial sector and enabling local and international FinTechs demonstrate the Kingdom’s dedication to embracing technological advancements.
Furthermore, the Financial Academy unveiled its new strategy for 2024-2026, focusing on enhancing human capabilities in the financial sector through training programs and professional certifications.
The academy aims to increase the number of trainees and improve the quality of its services to meet the evolving needs of the industry.
The 2023 FSDP report highlighted significant progress across sectors like fintech and digital banking.
The Kingdom saw a surge in fintech companies, surpassing 2023 targets with 216 in operation and launching two digital banks.
Saudi Arabia claimed the top spot in the Corporate Boards Index among G20 nations and secured second place in various indices. Foreign companies relocated headquarters to the Kingdom, deepening the capital market.
Moody’s, Fitch, and S&P Global Ratings revised Saudi Arabia’s outlook to “Positive” and affirmed its “A1” and “A+” credit ratings, citing fiscal policy development, economic reforms, and structural improvements.
Saudi Arabia led venture investments in the Middle East & North Africa, securing 52 percent of total investments in 2023, and allocated SR10 billion to support small and medium enterprises across economic activities and regions in the first half of the year.
Islamic finance industry projected to grow in 2024-2025
- Global sukuk issuance likely to reach around $170 billion in 2024
RIYADH: The Islamic finance industry is projected to grow globally in 2024-2025 with total assets likely to witness single-digit growth driven by economic diversification efforts, a report said.
It predicted that sukuk issuance globally would hover between $160 billion and $170 billion in 2024, representing a steady momentum from $168.4 billion in 2023 to $179.4 billion in 2022.
In its latest analysis, credit rating agency S&P Global highlighted that the industry grew by 8 percent and 8.2 percent in 2023 and 2022, respectively, stemming from growth in banking assets and the sukuk industry.
According to the US-based firm, Islamic banking assets grew 56 percent in 2023 compared to 72 percent in 2022.
Financial institutions across the Gulf Cooperation Council region accounted for 86 percent of the reserve increase in 2023, with Saudi Arabia becoming the chief contributor, having generated 56.7 percent of the maturation.
“We expect the implementation of Vision 2030 and growth in corporate and mortgage lending to continue supporting the Islamic finance industry over the next 12-24 months. In addition, the UAE showed a stronger contribution in 2023 thanks to the good performance of the non-oil sector,” the report noted.
It added: “Elsewhere, we observed some growth, particularly in Turkiye and Indonesia. The performance in Malaysia and Turkiye was somewhat tempered by the depreciation of the ringgit and the lira.”
According to the US-based firm, the issuance of this Shariah-compliant debt product began on a strong footing in 2024, with Saudi Arabia becoming a key contributor to the performance.
“The drop in issuance volumes in 2023, which mainly resulted from tighter liquidity conditions in Saudi Arabia’s banking system and Indonesia’s lower fiscal deficit, was somewhat compensated by an increase in foreign currency-denominated sukuk issuance,” S&P Global said in the report.
It added: “The market has started 2024 on a strong footing, with total issuance reaching $46.8 billion at March 31, 2024, compared with $38.2 billion at March 31, 2023.”
The analysis highlighted that the sukuk market will continue its growth momentum in the near term as financing needs in core Islamic finance countries remain high, given ongoing economic transformation programs, especially in countries like Saudi Arabia.
“We expect the sukuk market to fill in some of these needs. Specifically, we see some opportunities in the structured finance space with banks tapping the sukuk market to refinance their sizable mortgage books,” said the agency in the report.
The agency highlighted that the drive for digitalization and sustainability initiatives have yielded mixed results in the Islamic finance industry.
“While opportunities related to sustainable finance are significant as the industry is concentrated in oil exporting countries, progress has been relatively slow and limited in the global context,” according to S&P Global.
However, the report noted that digitalization has helped the banking side of the industry.
S&P Global concluded the study by saying that the future of Islamic finance is sustainable, collaborative, and digital.
“It is sustainable thanks to the alignment between Shariah principles, overarching pillars of sustainability, and the value proposition of Islamic finance that capture more than just financial objectives,” said the report.
According to the analysis, the future of Islamic finance is collaborative because stakeholders do not want to disrupt the industry equilibrium and erase the development achieved over the past 50 years.
The report added that digitalization will also impact Islamic finance in the coming years, as leveraging emerging technologies could help the industry enhance its efficiency and ultimately increase its value proposition for investors and issuers.
Pakistan says expecting more high-level Saudi business delegations amid investment push
ISLAMABAD: Pakistan expects continued visits by high-level business delegations from Saudi Arabia in the upcoming weeks to further explore investment opportunities facilitated under the Special Investment Facilitation Council, the Foreign Office announced on Thursday.
The statement came just days after Prime Minister Shahbaz Sharif concluded his visit to Riyadh, where he addressed the two-day World Economic Forum conference.
During his visit, Sharif met with Crown Prince Mohammed bin Salman and several Saudi ministers to strengthen bilateral relations and economic partnerships between the two nations.
Prior to his visit to the Kingdom, Saudi Foreign Minister Prince Faisal bin Farhan was in Islamabad with a large delegation, saying the Pakistani administration’s resolve to strengthen the economy would yield “significant benefits.”
“Saudi investors have been coming to Pakistan in recent months, and engaged with the SIFC in terms of exploring opportunities for Saudi investments in Pakistan, and this is an ongoing process, and we expect similar high-level business delegations to undertake visits to Pakistan in the coming days and weeks as well,” Foreign Office spokesperson Mumtaz Zahra Baloch told reporters in her weekly media briefing.
She added that both countries were involved in robust and mutually beneficial dialogue that had gained significant momentum in recent months.
“Pakistan and Saudi Arabia are engaged in consultations with each other in terms of increased Saudi investments in Pakistan, including in the energy domain,” she added.
Asked about reports of Pakistan providing military bases to the US, Baloch called them rumors.
“Pakistani has no plan to provide any bases to a foreign country against any other country,” she said.
Speaking about the Organization of Islamic Cooperation’s summit in Gambia, the spokesperson said the country’s deputy prime minister, Ishaq Dar, would highlight the ongoing genocide in Gaza, the right to self-determination of the people of Jammu and Kashmir, the imperatives of solidarity and unity of the Muslim ummah, rising Islamophobia, issues of climate change, terrorism, and other contemporary global challenges.
She said Pakistan strongly condemned the escalating violations of human rights by Israel and increasing number of illegal Israeli settlements in the West Bank.
“Israel’s actions constitute a breach of international law, including humanitarian laws and other pertinent international laws, and these acts also undermine any prospects of a two-state solution,” she added.
Saudi authority imposes $11.4m in fines on investors for dodgy practices
RIYADH: Saudi Arabia’s Capital Market Authority slapped fines to the tune of SR42.9 million ($11.4 million) on 13 investors and others found in violation of the law.
A total of SR17 million fines have been imposed on 13 investors “for placing purchase orders that influenced the share price, some of which were linked to sale orders, while trading on the shares of listed companies.”
A CMA statement said: “They and other investors were obligated to pay a total of SR25.9 million for the illegal gains achieved in their investment portfolios.”
The authority clarified that the definitive decision of its Appeals Committee for the Resolution of Securities Disputes resulted from the coordination and mutual collaboration between the authority and relevant entities.
It added that the action was taken in light of the public criminal lawsuit filed by the Public Prosecution.
CMA underscored the importance of investor confidence in fostering the growth and advancement of the financial market. It reiterated its commitment to vigilantly observe any misconduct, apprehend wrongdoers, and ensure the implementation of appropriate measures to impose penalties.
Moreover, it stated that these actions are consistent with the authority’s endeavors to nurture an appealing atmosphere for investors of all types, shielded from unjust, precarious, deceitful, fraudulent, or manipulative activities.
Saudi energy minister lauds growing economic ties with Uzbekistan
RIYADH: Saudi Arabia and Uzbekistan’s economic cooperation models reflect mutual commitment to prosperity through shared goals in the two countries’ 2030 plans, said the Saudi energy minister.
During the main dialogue session of the third Tashkent International Investment Forum, Prince Abdulaziz bin Salman emphasized the distinguished relations between the two nations and the commitment of their leaderships to enhance and develop cooperation in all fields, particularly in the energy sector.
Uzbekistan President Shavkat Mirziyoyev also attended the meeting.
The Saudi minister pointed out that economic cooperation between the two countries serves as a model, especially in light of the “Uzbekistan 2030” strategy and the Kingdom’s Vision 2030, with their similar goals aimed at economic growth, diversification, and sustainable development, reflecting a mutual commitment to building a prosperous future for both nations, according to the Saudi Press Agency.
“The bilateral relations saw a notable advancement subsequent to a meeting between Crown Prince Mohammed bin Salman and President Mirziyoyev in Riyadh in 2022,” he said.
Prince Abdulaziz stressed the significance of the energy sector in the growing relations between the two nations, particularly in renewable energy, highlighting the substantial involvement of Saudi companies in Uzbekistan, exemplified by ACWA Power.
He elaborated on the investment flowing between the two countries in this domain, eclipsing $14 billion, with the aim of producing over 11 gigawatts of renewable energy electricity, affirming that Uzbekistan has demonstrated a serious commitment to achieving a fair and equitable energy transition, aligning with the Kingdom’s aspirations.
The energy minister further underscored the rational stances jointly embraced by both nations, placing significant emphasis on the critical aspects of energy security, development, and conservation.
He also underscored the two countries’ collaborative roles in addressing climate change through collective endeavors.
Recently, ACWA Power signed a power purchase agreement with the National Electric Grid of Uzbekistan for the Aral five-gigawatt wind power project worth SR18.2 billion ($4.85 billion).
Two weeks ago, ACWA Power announced it had secured an $80 million equity bridge loan from the Bank of China for its projects in Uzbekistan.
The Saudi entity said the fund will boost its Tashkent 200 megawatts solar photovoltaic power plant and 500 MW per hour battery energy storage system project in Uzbekistan.
“This transaction culminated the initial agreement reached during the 3rd BRF (Belt and Road Forum) summit in October 2023, where ACWA Power was represented by its chairman as a keynote speaker,” the company said in a statement.
