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Saudi Competition Authority Approves 116 Applications for Acquisition

Saudi Competition Authority Approves 116 Applications for Acquisition
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Saudi Competition Authority Approves 116 Applications for Acquisition

Saudi Competition Authority Approves 116 Applications for Acquisition

The Saudi General Authority for Competition (GAC) has initiated criminal proceedings against 24 establishments, processed 299 complaints, and approved investigations into 16 of them after detailed evaluation. The authority dismissed 252 complaints, while 31 cases remain under review.

Since the beginning of 2024, 16 establishments have submitted settlement requests to the authority. Additionally, GAC approved 147 economic concentration (mergers and acquisitions) requests during the first three quarters of the year, classified 74 as non-reportable, and is still reviewing 12 applications.

In an interview with Asharq Al-Awsat, Saad Al-Masoud, the GAC spokesperson, highlighted that settlement is a vital mechanism for ensuring sustainability by correcting violations of the Competition Law and its executive regulations. Such requests are accepted from establishments before criminal charges are initiated.

The Role of GAC

Al-Masoud explained that GAC oversees the implementation of the Competition Law, aimed at promoting fair competition, combating monopolistic practices, ensuring a wide array of high-quality, competitively priced goods and services, and encouraging innovation. The authority’s three main functions include safeguarding fair competition, enforcing regulations and monitoring markets.

The authority also evaluates economic concentration reports (mergers, acquisitions, and joint ventures), issuing necessary decisions. Since January, it approved 147 economic concentration applications, 74 deemed non-reportable, while 12 remain under review.

Economic Concentration Insights

According to Al-Masoud, acquisition requests represented the majority of approved applications, totaling 116 (79%). Joint ventures accounted for 27 applications (18%), with three additional dealership registration requests in the automotive sector (2%), and one merger application (1%).

Exemptions

The authority offers programs, including exemptions under specific conditions outlined in the Competition Law. Companies can request exemptions from Articles 5, 6, and 7 of the law if their actions improve market performance, enhance quality, or provide consumer benefits outweighing restrictions on competition. However, the exemption must not allow the exclusion of competitors from the market for any product, Al-Masoud remarked.

Monitoring and Investigations

The authority identifies potential violations through complaints from individuals, referrals from government entities, or proactive market studies. It investigates and reports findings to its board, which decides on appropriate actions. In 2023, GAC received 141 complaints, dismissing 98 due to reasons such as lack of jurisdiction, insufficient evidence, or no legal violation.

Settlements and Reconciliation Program

Settlement is a corrective mechanism offered to violating establishments before criminal proceedings. The GAC spokesperson said that in 2023, 36 settlement requests were submitted, while 16 were filed in 2024. GAC’s board approved their study, avoiding criminal prosecution for these entities.

The Reconciliation Program, another key tool, allows establishments to disclose anti-competitive agreements and receive immunity from penalties. Al-Masoud revealed that three establishments were granted immunity in 2023 and 2024.

Spreading Competition Awareness

The authority actively promotes fair competition by raising awareness and enhancing specialized knowledge. In 2024 alone, GAC organized 9 workshops with chambers of commerce across cities, 7 university engagements for educational outreach, 25 workshops with national committees, meetings with over 113 entrepreneurs and businesspeople.

Additionally, GAC participated in major exhibitions and conferences, speaking at four of them, to engage its target audience more effectively.

Enhancing Competition

GAC conducts sectoral studies to evaluate market structures and identify anti-competitive practices. These studies benchmark Saudi markets against international standards and best practices, using economic and legal analyses to address competition-related issues.

Al-Masoud said that in recent years, GAC has completed market studies to assess competition levels in Saudi Arabia, deriving lessons and recommendations aimed at fostering effective competition. These recommendations focus on implementing improvements to reduce the likelihood of anti-competitive behavior.

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Business

SpaceX on Cusp of Record IPO that Could Make Musk a Trillionaire

FILE - SpaceX's mega rocket Starship prepares for a test flight from Starbase in Boca Chica, Texas, Monday, Nov. 18, 2024. (AP Photo/Eric Gay, File)
FILE - SpaceX's mega rocket Starship prepares for a test flight from Starbase in Boca Chica, Texas, Monday, Nov. 18, 2024. (AP Photo/Eric Gay, File)
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SpaceX on Cusp of Record IPO that Could Make Musk a Trillionaire

FILE - SpaceX's mega rocket Starship prepares for a test flight from Starbase in Boca Chica, Texas, Monday, Nov. 18, 2024. (AP Photo/Eric Gay, File)
FILE - SpaceX's mega rocket Starship prepares for a test flight from Starbase in Boca Chica, Texas, Monday, Nov. 18, 2024. (AP Photo/Eric Gay, File)

SpaceX enters the final stretch Thursday before its expected trading on Wall Street as part of the biggest initial public offering in history, which could propel co-founder Elon Musk to trillionaire status.

The company will be the first out of the gates among the tech and AI giants eyeing public markets, with OpenAI and Anthropic expected to follow, as both have filed with regulators for their own market debuts, AFP said.

If all goes as expected, the space and rocket company co-founded by Musk in 2002 will begin trading on the Nasdaq exchange on Friday morning, with all eyes on how Wall Street will absorb the blockbuster IPO that could send tremors across global markets.

For high-profile companies, the first day of trading traditionally sees executives ring the opening bell to mark the start of the session -- in this case at New York's Times Square, home of the Nasdaq.

The IPO is Musk's biggest financial gamble yet, with his xAI company and the X social media platform (formerly Twitter) also included in the SpaceX offering after the multi-billionaire folded them into the company earlier this year.

The company will offer more than 555 million shares at an expected $135, placing SpaceX among Wall Street's most elite companies with a valuation of around $1.8 trillion.

The operation will become official on Thursday, including the pricing, with questions swirling over whether the company will raise its offer price amid reports that it attracted more than four times the available shares, according to Bloomberg.

Thirty percent of the shares will be reserved for retail investors, triple the amount that is typically allocated in IPOs, giving Musk fans a chance to fork over for a slice of the company.

- Data centers in space -

The success of the IPO rests squarely on investors' faith in Musk as a visionary entrepreneur. The tech multi-billionaire will serve as chief executive, chief technology officer and board chairman of the newly traded company.

The IPO is expected to mint thousands of new millionaires and many billionaires, with former and current employees -- and a long list of investors -- from the company's near quarter-century history looking to cash in.

The financials of the company are giving some on Wall Street pause, as the valuation largely depends on Musk delivering on promises worthy of science fiction, including putting data centers in space as well as people on Mars using as yet unproven technology.

While the company is growing fast -- revenue hit $18.7 billion in 2025 -- it is also losing money, producing a net loss of $4.9 billion.

In an extraordinary prediction, SpaceX's filing claims it can pull in over $28.5 trillion in revenue from its various markets.

Business

ECB Set for 'Insurance Hike' as Iran War Fans Euro Zone Inflation

FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo
FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo
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ECB Set for 'Insurance Hike' as Iran War Fans Euro Zone Inflation

FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo
FILE PHOTO: Dark clouds are seen over the building of the European Central Bank (ECB) in Frankfurt, Germany, June 6, 2024. REUTERS/Wolfgang Rattay/File Photo

The European Central Bank is all but certain to raise interest rates on Thursday in the hope of nipping higher inflation in the bud before a surge in energy costs triggered by the Iran war spreads more broadly across the euro zone economy.

The well-telegraphed move would come as inflation in the 21-country currency bloc is already above 3%, well in excess of the ECB's 2% target, and economic growth is very weak - a backdrop that has economists split over the case for tighter policy.

ECB policymakers, some of whom had already pushed for action in April, are nonetheless expected to press ahead, seeking to keep a lid on inflation expectations and to safeguard their credibility after being slow to react to a post-pandemic inflation spike in 2022.

"The ECB needs to hike ‌to protect credibility ‌and prevent inflation expectations from de-anchoring, but it is still operating around neutral rather ‌than ⁠moving decisively into restrictive ⁠territory," Annalisa Piazza at MFS Investment Management said.

Thursday's hike would be the first in nearly three years and take the ECB's benchmark deposit rate to 2.25% from 2.0%. Sources have told Reuters the ECB is unlikely to commit to further rate rises this week but financial markets expect another two over the coming year, with the next move seen as soon as September.

The bank's new economic projections are also likely to hint at further rate hikes.

"New staff projections are likely to be consistent with three hikes and (ECB President) Lagarde is unlikely to dismiss this as unreasonable," JPMorgan's Greg Fuzesi said. "That would give the meeting a ⁠clear hawkish feel, even if the communication is likely to be more consistent with ‌the next move in September."

AN 'INSURANCE HIKE' THAT UNDERPINS EXPECTATIONS

Several ECB watchers have ‌characterized the expected move as an "insurance hike" - a precautionary step that could be reversed if price pressures fade.

Supporting the case for action, ‌the ECB is likely to raise its quarterly inflation projections on Thursday, bringing them closer to its "adverse" scenario published ‌in March, which saw inflation peaking at 4.2% in the final quarter of this year before falling back sharply in 2027. Consumers, companies and financial investors have revised their own views about price hikes, although medium-term expectations remain close to the ECB target and far from their levels in the aftermath of Russia's invasion of Ukraine.

"Two hikes this year thus looks like a minimum," Anatoli Annenkov at Societe ‌Generale said. "Markets are likely to start pricing in the next hike in July... but we still think a majority of governors would prefer to wait for more ⁠data and new forecasts in September."

HEADING ⁠FOR A POLICY MISTAKE?

Not all economists are convinced. Some warn the ECB risks tightening into an economy that is already paying a high price for the Iran war.

Berenberg's Holger Schmieding said the ECB was "heading for a policy mistake" given a stagnant labor market and weak consumer demand.

"Amid the ongoing destruction of demand, the inevitable temporary surge in prices ... seems unlikely to turn into a protracted inflation problem that would need to be addressed by higher rates," he wrote in a note. A Reuters analysis of earnings call transcripts by euro zone companies showed just 40% of those outside the financial sector had raised prices or were planning to do so, roughly half the share seen as the Ukraine war pushed up energy prices in 2022.

Eric Dor, director of economic studies at France's IESEG School of Management, said the ECB was overestimating its ability to influence household and business expectations, particularly in a situation where inflation is driven by fuel costs rather than domestic demand. But the ECB has sharpened its messaging in support of tighter policy. Chief Economist Philip Lane - typically seen as an inflation "dove" - has said the Iran-related shock may be broader in scope than the Ukraine crisis, as it affects global energy markets rather than primarily Europe.

Business

Gold Rebounds from 6-month Low; Inflation Data in Focus

A vendor displays gold bracelets for sale at a gold shop in Istanbul's Grand Bazaar (AFP)
A vendor displays gold bracelets for sale at a gold shop in Istanbul's Grand Bazaar (AFP)
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Gold Rebounds from 6-month Low; Inflation Data in Focus

A vendor displays gold bracelets for sale at a gold shop in Istanbul's Grand Bazaar (AFP)
A vendor displays gold bracelets for sale at a gold shop in Istanbul's Grand Bazaar (AFP)

Gold prices rebounded from a six-month low on Thursday, as investors bought the metal at bargain prices while awaiting a key US inflation report that could shed more light on the Federal Reserve's policy outlook.

Spot gold rose 0.5% to $4,095.64 per ounce by 0558 GMT, after hitting its lowest since November 21 at $4,022.09 earlier in the day. US gold futures for August delivery were ⁠down 0.4% at $4,116.20, Reuters reported.

"With ⁠prices hurtling towards $4,000, it's an obvious level of support that could prompt bears to book a quick profit or tempt battered bulls from the sideline," said Matt Simpson, a senior analyst at StoneX.

"The US dollar index failed to gain much ground following Wednesday's CPI report. So, unless ⁠there are any nasty surprises in PPI (Producer Price Index) - gold could be due a technical bounce over the near term."

US consumer inflation increased at its fastest pace in three years in May, boosted by surging prices for energy products amid the Middle East conflict.

The May US PPI data is due at 1230 GMT.

Traders are pricing in a more than 70% chance of a US rate hike by December, according to the CME FedWatch tool.

The United ⁠States and ⁠Iran traded air attacks on Thursday for a second straight day, with US President Donald Trump vowing further strikes if Tehran did not immediately agree to a peace deal.

Oil prices climbed on Thursday, after Iran declared the closure of the Strait of Hormuz following US strikes.

Elevated crude oil prices can accelerate inflation, and while gold is viewed as a hedge against inflation, higher interest rates tend to weigh on the non-yielding metal.

Spot silver rose 0.4% to $63.95 per ounce, platinum gained 0.4% to $1,671.09, and palladium climbed 2.9% to $1,248.45.