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Wednesday, June 30, 2010

The arrival of the Jewel of Muscat in Singapore

SINGAPORE : A representative of Oman, Sayyid Harib Thuwainy Al-Said, will be in Singapore from June 30 to July 6 to attend the welcome ceremony and gala dinner for the arrival of the Jewel of Muscat.

The Jewel of Muscat is a gift from the Sultanate of Oman to the Government and people of Singapore.

It set sail from Oman on February 16 and has called at ports in India, Sri Lanka and Malaysia on its way to Singapore.

It is scheduled to arrive in Singapore on July 3. Singapore's Ministry of Foreign Affairs said Mr Sayyid Harib will call on President S R Nathan and Prime Minister Lee Hsien Loong.

He will also meet Minister for Foreign Affairs George Yeo and Minister for the Environment and Water Resources Dr Yaacob Ibrahim.

He will also be hosted to a reception at the Malay Heritage Centre by Senior Minister of State for Foreign Affairs, Zainul Abidin Rasheed.

While in Singapore, Mr Sayyid Harib will be visiting the Tang Treasure, which was acquired by the Singapore Government through the support of the estate of Khoo Teck Puat. - CNA/ms

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Tuesday, June 29, 2010

Code Share pack between Oman Air and Malysia Airlines

By The Associated Press
June 29, 2010 - 04:47 a.m

KUALA LUMPUR, Malaysia - Malaysia Airlines on Wednesday inked a codeshare and co-operation pact with Oman Air, expanding its network in the Middle East which it hopes will bolster revenue by more than 26 million ringgit (US$8 million) annually.

Malaysian Airline Chief Executive Azmil Zahruddin said the pact will enable its passengers to fly nonstop from Kuala Lumpur to Muscat and book connecting flights to Amman and Kuwait City on Oman Air, as well as have more flight options to Dubai and Beirut.

Oman Air passengers in return, can book connecting flights on Malaysia Airlines to six new destinations namely Singapore, Hong Kong and the Malaysian cities of Langkawi, Kota Kinabalu, Penang and Kuching.

The Malaysian carrier aims to capture 60 per cent of existing traffic from Middle Eastern points to Kuala Lumpur and beyond, valued at more than 26 million ringgit ($8 million) a year, Azmil said.

"The main rational for this codesharing is to enhance revenue ... this partnership expands and strengthens our hub-and-spoke network. We will be able to capture untapped traffic from secondary points in Middle East through Muscat on our network," he said.

Oman Air Chief Executive Peter Hill said the two airlines will also collaborate on frequent flyer programs, ground handling, customer support, cargo and airport lounge access.

"Expanding the business is the name of the game. We are in this for commercial sustainability," he said. "We believe the partnership will pave the way not only to some Southeast Asian countries but also the Pacific region."

MAS currently offers 17 weekly flights between Kuala Lumpur and the Middle East including Dubai, Jeddah, Beirut and Istanbul. It also operates seasonal flights between Kuwait and Kuala Lumpur. Oman Air currently flies only to Bangkok and Kuala Lumpur in Southeast Asia.

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Friday, June 25, 2010

Blue city needs funding

Gulf News
By Manoj Nair

Dubai The coming weeks represent a make-or-break period for Oman's Blue City master-development, with a lot resting on whether new partners with the required knowhow and capital can be brought on board. These attributes will be a pre-requisite in getting the much-stalled project back on its feet and moving.

"Attracting the right sort of partner to come in at this stage is high on any turnaround agenda for Blue City," said a source who has been associated with the development ever since it was launched in 2006. "Fresh funding is what the development needs and needs now."

It is still early days on whether there are any interested parties out there willing to come in to revive the real estate project, which at 25 square kilometres — including 9 kilometres of beachfront — was one of the largest such attempted in a region known for its developmental excesses (It used to be called developmental flourishes in those days).

25-year plan

Located at some distance from the capital Muscat, the land is fully secured to the original promoters and was to be developed over 25 years and feature as many as 10 phases. Until now, work on just about 10 per cent of Phase I is all that has been done.

One of the problems, according to real estate analysts, was that the original masterplan envisaged Blue City as a high-density mixed-use development. There was to be residential, high-end and mid-priced, tourism-specific components, and offices.

After the launch in 2006, the project went into a period of quiet as the promoters wrestled with fund-raising issues and designing a workable masterplan. It was then revived in 2008 and construction did start on site. But the property markets collapsed towards the end of the year and the project has since been in limbo.

Given the way the region's property markets are behaving, it would take an immense leap of faith for any developer to commit to supporting a development that would take 20 years and more to realise its full potential.

If that's so, a stripped-down version could be attempted, said the source. "There's a lot of residual value in the land that could be unlocked by selling portions of it to third parties and leaving a core for the master development itself," the source added. "Selling some of the land would also help in raising fresh cash and would merit serious consideration in any future plans for Blue City."

But of more pressing importance is an upcoming verdict that is to be delivered by Oman's Supreme Court on an equity ownership dispute involving the two shareholders in Blue City Company 1, the operating entity set up to handle the development.

Equity ownership dispute

The dispute has already moved through the lower courts. "Once the Supreme Court delivers its verdict, and it looks it could happen any day now, that will be the tipping point for any progress on the ground at Blue City," the source added.

"Moreover, for any interested third-party to come into the picture now would require a clear understanding on the shareholder structure. If the stalemate is removed, it clears the ground for a lot of things."

These developments will be closely watched by Essdar Investments, the investment company which recently completed the buyout in the secondary market of a bond issued by Blue City Company 1 in late 2006. As of June 7, Essdar Investments was holding 99 per cent of the Class A1 and A3 Notes of the Blue City Company 1 bonds.

Mohammad Sotoudeh, CEO of Essdar, said: "With the credit crunch, more and more entities are finding it difficult to refinance. Essdar's strategy is to look at such businesses and develop and execute a strategy which can extract value for our investors and the businesses."

Interestingly, the Blue City bond pulled in an overwhelming level of interest from investors based in the US and Europe, and less so from the Gulf.

With little happening on the project from the construction side, it did not take long for the bond to slip to as low as 19 cents to the dollar by early 2007. It was around that time or thereafter that Essdar decided to acquire the bond in the secondary market.

The process culminated with the June 7 announcement that Essdar owns 99 per cent of the bond issue. "This investment is a landmark transaction in regional distressed debt and is a significant step towards Essdar's regional strategy," said Hamad Abdullah Al Shamsi, chairman of Essdar.

Essdar officials were not willing to comment on what their immediate priorities would be or the course of action they intend to take.

But other investment banking sources were quite willing to do so on what Essdar Capital could try. "As the Class A bondholder, and the sole one by the looks of it, they can try and enforce the issue by insisting on land sales to recover their investments," said a banker.

"They will also have access to whatever cash reserves are there on account of the bond issue," the banker added.

Enforcement can be a time-consuming, taking anywhere between 18 to 24 months.

The other option would be to take on the more strenuous task of restructuring the project and make it work at the third attempt.

"Whilst the media and public opinion focus has traditionally been upon the real estate aspects, this is primarily a tourism-driven development," said Christopher Steel, managing partner at Savills Oman.

"The planned hotels, commercial and associated facilities appear to be on track and are of intrinsic importance to any aspects of the residential real estate components.

Financial restructuring

"Any restructuring of the finances for the development must be viewed as a most positive step in ensuring that site works continue at a realistic pace to meet the occupational demands of the burgeoning tourist arrivals into Oman."

But the banker reckons the restructuring can prove onerous. "It must involve all parties — the shareholders, subordinated bondholders and contractors," the banker said.

"It will take some doing especially as the environment is still not conducive for major real estate initiatives. The next two to three months will be decisive."

For a development that has stuttered from one crisis to another since 2006, two to three months cannot be that long.

© Gulf News 2010. All rights reserved.

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Sunday, June 13, 2010

Oman to make first Middle east electrical car

Published: June 12, 2010 at 9:08 PM

MUSCAT, Oman, June 12 (UPI) -- The Middle East, sitting atop the world's greatest oil reserves, is going to start making its first electric-powered car, a company executive in Oman says.

The Times of Oman reported Saturday Sultan bin Hamad al-Amri, chief executive office of Noor Majan, recently told an Arabic daily in Oman the car will be designed to go from zero to 60 mph in about 4 seconds, roll for 2,250 miles on a single electrical charge and go for 21 years without any maintenance. The price tag will be between $70,000 and $91,000, he said.

"The parts of the car, including the 800-horsepower engine, are manufactured in Japan, America, Germany and Hong Kong," he said.

He says the car will have a solar-powered air conditioner and be fitted with massage chairs.

The company plans to turn out about 120 cars a year in a plant it proposes to open in Barka, Oman, the Times said.

Al-Amri said the idea for the car occurred to him in 2008 during a trip to London where he saw an Indian-manufactured electric car called the Reva.

"I felt we could manufacture the car with altered specifications, design and style," al-Amri said.

He said he lined up engineers and spent a year doing a feasibility study before approaching the Oman government for permission to go ahead.

"We have already got preliminary approvals from the Ministry of Trade and Industry and the Ministry of Environment and Climate Affairs," he said, adding they will be tested in Florida to qualify for an international quality certificate.

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Thursday, June 10, 2010

Essdar to buy shares of Oman blue city

By Arif Sharif
June 09, 2010, 4:26 AM EDT

June 9 (Bloomberg) -- Essdar Investments Ltd., a Cayman Island-based fund, agreed to buy $655.5 million of outstanding notes backed by Oman’s stalled Blue City development at a 37 percent discount.

Essdar, an investment partner with Dubai-based Essdar Capital Managers Ltd., will hold 99 percent of two notes sold in 2006 by Oman’s Blue City Investments 1 Ltd. following a tender offer, it said in an e-mailed statement from Dubai today. The notes had a combined $661.5 million of outstanding principal as of November, 2006, the company said.

Blue City, an hour from the capital, Muscat, was supposed to produce more than 200 villas, 5,000 apartments, four hotels, two golf courses and a clubhouse, according to the notes’ prospectus. A total of $925 million was raised from bondholders to finance construction, which started in 2006.

Essdar said today it will pay $630.3 per $1,000 for $399 million of outstanding Class A1 notes due 2013 and $624.8 per $1,000 for $262.5 million of Class A3 notes due 2016.

Blue City, a $20 billion real estate project central to the Oman’s economic transformation, was envisioned as a new community for more than 200,000 people. It missed sales targets as real estate speculators left Middle Eastern markets and a legal battle between the project’s owners undermined confidence.

To contact the editor responsible for this story: Edward Evans at

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