Dubai buys $1 Billion stake in DaimlerChrysler AG:
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Dubai buys $1 Billion stake in DaimlerChrysler AG:
Dubai buys $1bn stake in Daimler-Chrysler
Sun Jan 30, 2005 06:53 AM ET
(Adds DaimlerChrysler spokesman, details)
By Richard Dean
DUBAI, Jan 30 (Reuters) - The government of the Gulf emirate of Dubai has bought a $1 billion stake in DaimlerChrysler AG (DCXGn.DE: Quote, Profile, Research) (DCX.N: Quote, Profile, Research) , becoming the auto maker's third largest shareholder, it said on Sunday.
The purchase was made through the government's wholly owned Dubai Holding company, which was set up last year to oversee the emirate's ambitious, multi-billion dollar domestic and foreign investment schemes.
"We welcome Dubai as a long-term investor, which shows it believes in DaimlerChrysler's potential," a DaimlerChrysler spokesman said, confirming the deal.
Industry sources said that neither Deutsche Bank AG (DBKGn.DE: Quote, Profile, Research) nor the Gulf state of Kuwait -- DaimlerChrysler's biggest and second-largest shareholders -- had reduced their stakes. Dubai's stake was about 2 percent, the sources said.
"This is a perfect time to acquire shares in DaimlerChrysler as the company begins to bear the fruits of its merger with Chrysler," said Mohammed Al Gergawi, chief executive of Dubai Holding.
He said in a statement that Dubai Holding had faith in DaimlerChrysler's management team.
Dubai, the trade and tourism hub of the Gulf region, set up Dubai Holdings in late 2004.
The firm is mainly focused on real estate and tourism ventures in Dubai, but it also set up an international private-equity arm, Dubai International Capital, for foreign acquisitions.
INDUSTRIAL AMBITIONS:
Dubai is one of the emirates in the oil-rich Gulf state of the United Arab Emirates (UAE). The emirate is striving to create a diversified, non-oil economy to make up for falling revenues from dwindling crude reserves.
Walid Shihabi, an analyst at Dubai-based investment bank Shuaa Capital, told Reuters the deal may lead to DaimlerChrysler investing in a Dubai-based manufacturing facility.
In 2004, Dubai announced plans to create an industrial hub aimed at attracting foreign and domestic investment.
"It might be in exchange for DaimlerChrysler establishing an industrial presence. This may be similar to the deal in Abu Dhabi, where VW is going to create a production line," Shihabi added.
In November 2004, Volkswagen AG (VOWG.DE: Quote, Profile, Research) led a consortium that bought European vehicle-leasing company Leaseplan for 2 billion euros ($2.61 billion). Mubadala Development Co. of the Abu Dhabi government had a 25 percent stake in the deal.
In December 2004, Volkswagen announced plans to build an assembly line for heavy trucks in Abu Dhabi, the oil-rich capital of the UAE.
DaimlerChrysler's Middle East headquarters is located in Dubai's Jebel Ali Free Zone, where the company employs around 100 people. In 2004 DaimlerChrysler sold just under 29,000 vehicles in the Middle East, up 14 percent on 2003.
(Additional reporting by Jonathan Gould in Frankfurt)
© Reuters 2005. All Rights Reserved.
redriderbob
Sun Jan 30, 2005 06:53 AM ET
(Adds DaimlerChrysler spokesman, details)
By Richard Dean
DUBAI, Jan 30 (Reuters) - The government of the Gulf emirate of Dubai has bought a $1 billion stake in DaimlerChrysler AG (DCXGn.DE: Quote, Profile, Research) (DCX.N: Quote, Profile, Research) , becoming the auto maker's third largest shareholder, it said on Sunday.
The purchase was made through the government's wholly owned Dubai Holding company, which was set up last year to oversee the emirate's ambitious, multi-billion dollar domestic and foreign investment schemes.
"We welcome Dubai as a long-term investor, which shows it believes in DaimlerChrysler's potential," a DaimlerChrysler spokesman said, confirming the deal.
Industry sources said that neither Deutsche Bank AG (DBKGn.DE: Quote, Profile, Research) nor the Gulf state of Kuwait -- DaimlerChrysler's biggest and second-largest shareholders -- had reduced their stakes. Dubai's stake was about 2 percent, the sources said.
"This is a perfect time to acquire shares in DaimlerChrysler as the company begins to bear the fruits of its merger with Chrysler," said Mohammed Al Gergawi, chief executive of Dubai Holding.
He said in a statement that Dubai Holding had faith in DaimlerChrysler's management team.
Dubai, the trade and tourism hub of the Gulf region, set up Dubai Holdings in late 2004.
The firm is mainly focused on real estate and tourism ventures in Dubai, but it also set up an international private-equity arm, Dubai International Capital, for foreign acquisitions.
INDUSTRIAL AMBITIONS:
Dubai is one of the emirates in the oil-rich Gulf state of the United Arab Emirates (UAE). The emirate is striving to create a diversified, non-oil economy to make up for falling revenues from dwindling crude reserves.
Walid Shihabi, an analyst at Dubai-based investment bank Shuaa Capital, told Reuters the deal may lead to DaimlerChrysler investing in a Dubai-based manufacturing facility.
In 2004, Dubai announced plans to create an industrial hub aimed at attracting foreign and domestic investment.
"It might be in exchange for DaimlerChrysler establishing an industrial presence. This may be similar to the deal in Abu Dhabi, where VW is going to create a production line," Shihabi added.
In November 2004, Volkswagen AG (VOWG.DE: Quote, Profile, Research) led a consortium that bought European vehicle-leasing company Leaseplan for 2 billion euros ($2.61 billion). Mubadala Development Co. of the Abu Dhabi government had a 25 percent stake in the deal.
In December 2004, Volkswagen announced plans to build an assembly line for heavy trucks in Abu Dhabi, the oil-rich capital of the UAE.
DaimlerChrysler's Middle East headquarters is located in Dubai's Jebel Ali Free Zone, where the company employs around 100 people. In 2004 DaimlerChrysler sold just under 29,000 vehicles in the Middle East, up 14 percent on 2003.
(Additional reporting by Jonathan Gould in Frankfurt)
© Reuters 2005. All Rights Reserved.
redriderbob