SEOUL: Samsung Group’s two insurance firms said on Wednesday they will sell $1.3 billion worth of stock in the conglomerate’s biggest earner, Samsung Electronics, to maintain regulatory compliance.
Samsung Life Insurance Co. Ltd. and Samsung Fire & Marine Insurance Co. Ltd. separately said their electronics affiliate’s current policy of canceling its own shares to raise the value of investors’ holdings risks pushing their own holdings beyond regulatory limits.
Samsung Electronics stock fell 3.5 percent after local media first reported the sales plans, as investors feared the sudden increased supply would push down its price, analysts said.
The announcements come at a time when regulators are questioning conglomerates’ cross-shareholding arrangements, saying the web-like ownership structures undermine corporate governance by allowing founding families to control business empires with only direct minority stakes in key units.
In South Korea, conglomerates’ financial arms are required to limit their combined stake in a non-financial affiliate to 10 percent.
Samsung Life owns 8.63 percent of Samsung Electronics stock with a market value of $26 billion. It said it will sell 1.2 trillion won ($1.11 billion) worth in a single transaction before the stock market opens on Thursday, reducing its stake to 7.92 percent.
Samsung Fire & Marine said it will also conduct a block sale of 206 billion won worth of stock, reducing its stake to 1.38 percent from 1.45 percent.
The block sale in 48,300 won – 49,500 won each range represents a discount of up to 2.4 percent to Samsung Elec’s last traded price, according to a term sheet of the deal seen by IFR on Tuesday.
Samsung Life may need to further reduce its holding should parliament push through a 2016 proposal to limit an insurer’s investment in any affiliate to 3 percent or less of the insurer’s total assets, to promote stable asset management.
The ownership of South Korea’s powerful conglomerates has come under increased scrutiny this year following a series of scandals involving members of conglomerates’ founding families.
The chairman of the Financial Services Commission recently said Samsung — a group of 62 affiliates — must consider ways to reduce the risk of having too much of its $375 billion assets concentrated in one place, including selling some or all of Samsung Life’s stake in Samsung Electronics.
The chief of the Korea Fair Trade Commission also called the group’s ownership structure “unsustainable.”
In April, Samsung SDI Co. Ltd. sold $526 million worth of shares in affiliate Samsung C&T Corp. to reduce cross-shareholding and secure funds for investment.
Samsung firms sell $1.3 billion Samsung Electronics stock to maintain compliance
Samsung firms sell $1.3 billion Samsung Electronics stock to maintain compliance
Saudi Ma’aden extracting lithium from seawater, CEO says
RIYADH: Saudi Arabian Mining Co. Ma’aden has successfully extracted lithium from seawater, although not at levels that are commercially viable, and its project remains at the pilot stage, the company's CEO told Reuters on Tuesday.
“We are actually producing lithium from seawater now,” Robert Wilt said.
Wilt, who is also the vice chairman of Manara Minerals, also said that company was not looking at acquiring diamond business De Beers. “We are not looking at De Beers at all,” he said.
Riyadh Airport leads annual audit awards as service quality improves across the Kingdom
RIYADH: King Khalid International Airport secured first place at Saudi Arabia’s annual Aviation Security Audit Awards, with the Kingdom’s terminals achieving an 80 percent overall average in service quality assessments for 2023.
Announced during the Future Aviation Forum held in the Saudi capital, the Riyadh-located facility secured the top ranking based on factors such as operational performance standards, evaluation of airport facilities and services, passenger satisfaction questionnaire, and passenger complaints.
King Abdulaziz International Airport in Jeddah and Abha International Airport collected the second and third awards, respectively.
The General Authority of Civil Aviation highlighted a 6 percent increase in Saudi airport performance in 2023 compared to the previous 12 months in its Comprehensive Airport Service Quality Assessment Program results.
The program, one of GACA’s initiatives, aims to evaluate and enhance the quality of services provided to passengers at Saudi airports, improving the travel experience.
The event was attended by Abdulaziz bin Abdullah Al-Duailej, president of GACA, along with CEOs of airport companies and directors general of Saudi airports.
In his speech, Al-Duailej emphasized that passenger services and satisfaction are fundamental principles guiding the Kingdom’s airports. He also highlighted the annual event’s role in showcasing its commitment to enhancing service quality, creating competitive airport environments, and promoting continual improvement and development.
“As part of its regulatory and supervisory role, GACA has taken numerous steps to develop the Kingdom’s aviation system for effective performance,” he said.
Al-Duailej added that improving the passenger experience and providing services that meet international standards are among GACA’s top priorities, aligning with the objectives of the National Aviation Strategy.
The president also noted that GACA is continuously working to improve the passenger experience at airports by implementing strict monitoring and supervision standards and indicators.
He further stated that over 1 million samples of operational performance data have been collected, and feedback from service users and stakeholders has been incorporated into the service development process.
Abdulaziz bin Abdullah Al-Dahmash, executive vice president for quality and passenger experience at GACA, noted that in 2023, the authority issued around 500 reports under the program.
These included monthly and quarterly operational performance reports, passenger satisfaction surveys, semi-annual program results reports, and annual program review reports.
During the event, Al-Duailej launched the ‘Bridges’ program, which aims to empower and connect the Saudi airport sector with local content, starting with 23 investment opportunities valued at SR7 billion ($1.87 billion) by 2030. The program is designed on several strategic pillars to develop national human capabilities.
STA launches summer program to boost tourism sector
RIYADH: The Saudi Tourism Authority has launched its summer program for 2024 with a lineup of events taking place across seven destinations in the Kingdom.
According to a press statement, the program launched under the title “Saudi Summer is Next Door” will run for a duration of four months until the end of September.
The seven destinations included in the summer campaign are Riyadh, Jeddah, AlUla, and the Red Sea, as well as Aseer, Al Baha, and Taif.
Ahmed Al-Khateeb, Saudi Arabia’s minister of tourism, said that the Kingdom is witnessing rapid growth in the hospitality sector, as it received record-breaking numbers of incoming visitors in 2023.
“Saudi Arabia is witnessing a transformative period in tourism, driven by our vision to position the Kingdom as a premier global destination. The Saudi Summer Program 2024 is our commitment to showcasing the rich cultural heritage, natural beauty, and unparalleled hospitality that Saudi Arabia offers,” said Al-Khateeb.
According to the UN’s World Tourism Barometer, Saudi Arabia’s number of visitors arriving in 2023 reached 106 million, a 156 percent increase on 2019.
This year’s summer program will also see the return of the Jeddah Season and the launch of the Aseer Season, featuring numerous family activities and events.
“We invite local and international tourists to experience the diversity of our seven unique destinations and take advantage of the exceptional offers and packages designed to create unforgettable memories,” added Al-Khateeb.
Developing the tourism sector is crucial for Saudi Arabia, as the Kingdom is steadily diversifying its economy by reducing its dependency on oil.
Saudi Arabia’s National Tourism Strategy aims to attract 150 million visitors by 2030 and increase the sector’s contribution to the Kingdom’s gross domestic product to 10 percent from the current 6 percent.
Commenting on the summer program, Zurab Pololikashvili, secretary general of the World Tourism Organization, said: “Saudi tourism is witnessing unparalleled development at all levels, achieving great leaps in recent years. Saudi Arabia has global indicators related to the number of tourists, which has qualified it to top the UN World Tourism list of significant tourist destinations.”
For his part, Fahd Hamidaddin, CEO and board member of STA, noted that this year’s summer program includes more than 550 tourism products and 150 special offers, including discounts on hotel bookings.
Moreover, the launch of the summer program comes at a time when visiting Saudi Arabia has become more accessible. To accelerate the number of incoming tourists, Saudi Arabia launched the eVisa and made it available to citizens of 66 countries, which made the Kingdom’s visa 20 percent less expensive.
Saudi Arabia and Australia sign deal to boost trade ties
RIYADH: Trade ties between Saudi Arabia and Australia are set to strengthen after the two countries signed an agreement to improve cooperation across multiple sectors.
According to a press statement, the memorandum of understanding was inked between the Australia Saudi Business Council & Forum and the Export Council of Australia.
The agreement will focus on cooperation in industry, mining and food as well as agriculture, technology, and artificial intelligence.
The deal will increase the opportunities for Australian exporters to collaborate with Saudi entities, enhancing bilateral cooperation.
The agreement was signed by the President of the Australia Saudi Business Council & Forum, Sam Jamsheedi, and Arnold Jorge, CEO of the Export Council of Australia, during the latter’s visit to the Kingdom with a delegation.
“Under this strategic partnership, we will seek to work together closely in identifying initiatives that facilitate connections between Australia and Saudi Arabia,” said Jamsheedi.
According to the UN Comtrade database, Australia’s exports to Saudi Arabia stood at $789.65 million in 2023.
On the other hand, the Kingdom’s exports to Australia amounted to $702.75 million over the same 12-month period.
“We will combine our resources and networks to boost the success of collaborations and partnerships between relevant organizations and individuals of our two countries,” said Jorge.
The Australia Saudi Business Council was formed in 2013 to facilitate the promotion of ongoing and bilateral trade between the two nations.
In November, Saudi-based Abdel Hadi Al-Qahtani and Sons Co. and Australia’s SSS Group signed a $27 million deal to collaborate in the production of scaffolding systems in Saudi Arabia using local resources.
After the deal was signed, Australian Ambassador Mark Donovan told Arab News at the time that the cooperation agreement builds on the existing investment ties between both countries in various sectors, including education, health care, aviation, and services.
“A new and transformed Saudi Arabia is looking for business relationships around the world, and that’s what we’re very pleased to be a part of,” said Donovan at that time.
In March, Australia’s University of Wollongong procured licenses to open its branches in the Kingdom.
Top Saudi officials hold discussions with global aviation giants
RIYADH: Supply chain challenges, investment attraction, and modern technology were all discussed by Saudi Arabia’s industry minister and the heads of global aviation companies at the Future Aviation Forum 2024.
Bandar bin Ibrahim Alkhorayef held discussions with the president of the Commercial Aircraft Corp. of China, the president and CEO of Embraer Commercial, and the president of Boeing, at the Riyadh event, the Saudi Press Agency reported.
Alkhorayef focused on bolstering cooperation across various segments of the aviation industry in the talks and the discussions highlighted the Kingdom’s opportunities, addressed global supply chain challenges, and explored avenues for investment attraction, technological advancement, and knowledge exchange.
Meanwhile, the minister toured the pavilions of several global aviation companies, including Airbus, Boeing, and Riyadh Air, participating in the event organized by the General Authority of Civil Aviation at the King Abdulaziz International Conference Center.
Furthermore, he received updates on the latest technologies and recent advancements in the aviation industry and its related sectors.
On May 20, Saudia Group signed a $19 billion order deal for 105 planes, marking the largest aircraft deal with Airbus in the Kingdom’s history.
The agreement was made public in the presence of Minister of Transport and Logistic Services Saleh bin Nasser Al-Jasser and Benoît de Saint-Exupery, executive vice president of sales at Airbus. Saint-Exupery stated that the new aircraft will play a “vital role” in contributing to Saudi Arabia’s ambitious Vision 2030 plan.
The forum, held under the patronage of King Salman from May 20 to 22, showcases investment opportunities exceeding $100 billion. It aims to achieve the goals of Saudi Vision 2030, transforming the Kingdom into a leading logistics hub in the Middle East and meeting the objectives of the national aviation strategy.
The event features participation from over 30 ministers, 77 leaders of civil aviation authorities, global airline executives, and 5,000 industry experts and leaders from more than 120 countries.
