Wednesday, May 5, 2010

And the lucky winner is.... Plus more on Blue City

Sorry for the lack of posts this week dear Reader, I've been a busy Dragon; lots of knights to slay, maidens to ravish, treasure to hoard, you know how it is. Work work work.

First, the draw for the winner of 2 free tickets to the Muscat Rugby club fund raiser, a comedy night featuring up to a dozen comedians on Thursday May 13th and held at the Muscat rugby club near the ABA school in Al Khuwair.

The draw was held under the usual supervision of Ms Dragon and a very senior member of the Internal Security Service on Monday evening. And the winner was...

"Delirious in the Desert"

Congrats DITD! Enjoy. I've been promised a review and pics. The rest of you, there are still tickets available.

Blue City
Well connected fan Ibrahim made a great comment on the last Blue City story, and I'm reposting here, because this information is accurate and hard to find.

Dear UD,

Your blog is hugely popular. Your accurate and authentic information is sincerely appreciated. Let me add some more data on the blue city project. Hopefully those maroons who messed should wake up. Its about time His Majesty Qaboos asks Anees to shut up and get out of the project. Enough of wasta boss.

Issuer = Blue City Investment 1 Limited (Commercial Registration No. WK163178) incorporated in Cayman Islands for the purpose of issuing Class A, B, C & D Notes worth US$ 925 Million. Borrower = Blue City Company 1 SAOC (Commercial Registration No. 1/83627/7) incorporated in Oman.

On 7th November 2006 Blue City 1 SAOC signed Intercompany Loan Agreement and received US$ 921,400,960 as follows: Class A1/Class A2/Class A3/Class A4 – 658,982,625; Class B – 142,200,630; Class C – 50,217,705 and Class D – 70,000,000.

There were many PARTIES to the transaction. Namely, (1) The Bank of New York as Offshore Security Trustee (2) Bank Muscat SAOG as Onshore Security Trustee (3) Bear Stearns Bank Plc as Class A guarantor (4) The Bank of New York as Offshore Account bank (5) Bank Muscat SAOG as Onshore Account bank. Bear, Stearns International Limited were the arranger and Oppenheimer (Samuel Grossmann) as the brokers.

Clifford Chance drafted all agreements and Iain Morpeth is the man in-charge. The Intercompany Loan agreement contains a number of representations, covenants and events of default which are subject to a Material Adverse Effect qualification. Project documents specified are: Development agreement, Construction contract, construction security, construction contract guarantee, land transfer agreements, Works agreement, Balance of Work agreement, Additional Works Agreement, etc.

Government of Oman represented by its ministers (Tourism, National Economy and Commerce & Industry) have signed & ratified agreements, why are these ministries keeping silent?

If the SEC (Securities and Exchange Commission of the USA) can take on Goldman Sachs for fraud, why spare Blue City? US$ 50 Million was held in the Blue City 1 SAOC’s Bank Muscat account as escrow, where is that money?

US$ 20 Million was escrowed for the purchase of Al Sawadi Beach Resort Hotel and of the associated usufruct, where is that money?

Blocked escrowed for the company was US$ 105,417,358, where is this money?

US$ 440,588,374 was the total initial mandatory deposit that was made with the issuer (Blue City Investment 1 Limited, Cayman Island). Where is the audited financials for Blue City 1 SAOC and Blue City Investment 1 Limited???

Can somebody from Blue City 1 SAOC answer?

Here, here Ibrahim. And not even a press release in the Times of Oman explaining the total normality of the bankruptcy, global crisis, just look at Dubai, etc etc etc. How peculiar!

As for those bonds, you might be interested to know the latest market prices*, as advised by a trusted source in a GCC National Bank treasury outfit. Pricing of a $100 Blue City Bond as of the 27/4/2010 was:

Secured tranch Class(A1) $35.55
Secured tranch Class(A2) $30.50
Subordinate tranch Class (B1) $25.35
Subordinate tranch Class (C) $20.35
Subordinate tranch Class (D) $10.40

Bare in mind that the tranch A1 was priced at closure at $98.50 and reached once upon a time to the whereabouts of $120!

Wow. Way to destroy value ASIT team!

The secured A1 & A2 bonds seem to have a very small spread against the absolute D class junk, given they are supposedly fully secured on billions of dollars worth of 25km2 of Al Sawadi land. This can only reflect the way the market is currently pricing the competency and trustworthiness of the people behind Blue City, or they'd instead, IMHO, be up around 70-80 cents (just compare with unsecured Dubai Holdings bonds recently).

*This is just for information and is not a recommendation for people to act upon or invest. Muscat Confidential does not provide investment advice. Readers are strongly advised to always obtain advice from their own legal and financial advisors before making any financial commitments that would require them to pour good money after bad.


  1. Dragon, As you wrote... Wow. Wow, wow, wow indeed. Surely this project has got to go down as the worst managed project in the WHOLE of Middle East. There must be prizes for this... no? Can you start one? The only creditable folk seem to be the AAJH lot from Bahrain. I've actually been to Bahrain and seen some of their projects, and to me they do seem a highly competent outfit. What has 'The Paper Boy' Anees and his side-kick Miri (and the rest of the Exec Cyclone team) EVER done? Er, umm, what was that? Did I hear someone say sweet fuck all? Yep, nada. A bit of ducking and diving here, a bit of ducking and diving there. So, "bottom's up" the ASIT-Cyclone team! Bonza job!! Me think's its double Margarita's all 'round?

    Cheers, Willie D.

  2. Hi Dragon- sorry you have been so busy with knights to radish, maidens to lay, and pleasures to hoard, I know how it is-- just work, work, work.

    Thanks for the info on 'Blue City.'

  3. Aaahh Blue Shitty....the turd that just keeps on stinking!

  4. Dear UD,

    Looks like nobody from ASIT / BCC1 reads this blog.
    I hope somebody from the Government of Oman is reading it at least. I guess its time to start posting attachments (various agreements and other correspondence) through this wonderful blog to call the attention of the highest authority of the Sultanate a.k.a. His Majesty Sultan Qaboos himself. I wonder how much longer will HM wait to punish the law-breaker that everyone knows as Anees Issa.

    Please somebody let HM know the truth.

  5. An Informed Omani [Edited]May 6, 2010 at 5:46 PM

    Ibrahim, you are wrong. The pimps running the ASIT/BCC1 are petrified to respond. They are aware that they are in deep, deeeeep shit and have no truth to offer to our Government and to the investors. Bahraini partners came to our country to milk money; but at least they have the courage to go public with the facts. It’s a shame Cyclone / ASIT / BCC1 headed by a [UD: text deleted] called Anees (truly an a*?!$$## ) is showing the world how [UD: text deleted] he is. His entourage includes [UD: text deleted]. I am surprised that AAJ has not filed a criminal case against Anees in the international court.

  6. I heard that the Bahraini guy AAJ was booted out of the Finacial Harbour project in Bahrain by his Brother/ Cousin Essam Janahi for dubious misdeeds and now the family have nothing more to do with him....

    Maybe he was here to really milk the money as the Informed Omani said.

    I don't think he is as innocent as made out,I think there is more to AAJ than meets the eye...

    Maybe UD can do some digging on AAJ...


  7. Well said Ibrahim!! Its good to know the facts with figures and you sure know what you are saying. It's a crying shame, really, for the entire Gulf... Why isn't OMAN Government doing SOMETHING to save this project? Why won't the Bahraini's request for a private audience with HM or the top people in his govt to resolve this shame?

    Ibrahim, do continue to write in. The entire Oman's public need to know the TRUTH. Let us know with names & documents who else has been responsible for this shame brought upon our country. People at BC1 needs to reply, somewhere, to clear this royal mess.

  8. Breaking News! Muscat Confidential is now the official proxy publication of AAJ Holdings! Complete narcissism, nepotism, collaboration and guaranteed mutual gratification. UD who is giving and who is receiving? Is Willie D giving it to Farmer J on Brokeback Mountain? Inquiring minds want to know. I'm so jealous, I wish you were my prison bitch too!! - Gaylord

  9. Anton,

    I am sorry to say you are wrong... if you don't know the facts about the BFH issue kindly put a lid on it...

    AAJ was never a shareholder in BFH, they were the visionary behind it. AAJ's role was over and he was paid for his work by his nephew Esam who happens to be my cousin as well!! and that's how he BOUGHT the shares that Cyclone are trying to hijack not from Cyclone but from another entity called "OASIS"

    for your kind info AAJ Holdings has another project in Bahrain "Marina West" it started almost a year after the closure of the Bond.. It is now 60% constructed and almost 70% sold. check out their site "" and pass it to your friends in Blue city so they can learn something in project management as clearly they are only good as "paper Boys"

    A Janahi family member

  10. Dear Ibrahim,

    It seems that 2 were sent by our joint friend in BCC1 to divert the attention of the topic of the blog to AAJ rather than their F#*!-up in the project...

    So pathetic.. as it shows how clumsy and shallow minded they are!!

    Sheer Fiction VS. Actual Facts!!

    Keep it up UD at least I am confident that you wouldn't write this topic in your blog with such strength if you didn't poses the facts and actually believed in them..

  11. Dear Gaylord/Anonymous/Blue City, Tra la! So, it would seem BC/Cyclone/ASIT has finally responded!! Hopefully your desire to have some prison bitches will be soon granted. What a sad bunch of (failed) project-plonkers you are. You really need to get your heads out of your collective arse's, get out and about a bit, and try and get real - if not for everyone else's sake, at least for your own.

    Willie D.

  12. wow.... Such interesting responses...

    BTW I haven't been in the country long enough... but you can believe what you like..

    I have no involvement with Blue City, my source is in Qatar and they got that info from a senior person in GFH...

    As you raised the issue care to elude about the issues in BFH to set the record straight then?

    I have no axe to grind either way, I was merely being objective and was just asking the question....

    I believe balanced views are much better than one eyed views... I am sure UD would agree with that.

    I think you will find that info on the bond is already in the public domain, it looks like it's
    from the origional public prospectus if I am not mistaken.

    Anyway have a great day guys..

    LOL...maybe I should change my name to Agent Provocateur :)


  13. The first unofficial spokesperson (Anton) of BCC1 or ASIT or Cyclone has finally woken up. Not surprisingly, Anton has got it all wrong. Come up with some facts and use google you jerk. Check for public domain information on people and companies before you waste the space on UD’s blog.

    Let me give you some more specifics. Blue City 1 SAOC was formed in Oman (at Ministry of Commerce & Industry) and Trowers & Hamlins set-up this company. 5 directors were appointed for BCC1 SAOC, of which 2 (Ahmed & Othman) were from AAJ Holdings Bahrain and Anees Issa from Oman. Fariborz Ghafforokh Akhlaghi was appointed as the MD & CEO of the company and was made one of the board of directors as well. The all important independent director was Willem Martinus De Roo. Where is this Willem M De Roo now? Where is Fariborz G. Akhlaghi now? Are these two on the Interpol watch list or what? Oh by the way Anton, don’t forget to include Saleh Miri’s whereabouts in your response.

  14. Guys,

    I am reading the black prospectus and a certain issue came right in front of my eyes, in page 22 under the title: Borrower Level Security Structure

    "The proceeds of the issue of the Notes will be on-lent by the Issuer to the Borrower to be applied towards, inter alia, (i) the construction of Phase 1 of the Project"

    My Question to the one and only? how on earth you report to the Bondholders that you are borrowing the Money to construct and you don't. In fact you use the money to re-design the entire Blue City Just to try to wipe out AAJ Holdings name!?!

    Duhhh people go to jail for that!!

    On the other hand I am reading from the FITCH report on the Bond offering page 4:

    "Parties to the Transaction


    The main sponsor of the project, with a 70% indirect ownership stake in ASIT, is AAJ, a Bahrain-based real estate development and investment company founded in 1988 and controlled by Mr. Ahmed Abubaker Janahi. AAJ effectively assumes the role of the project developer and also provides various professional services through its subsidiaries, including: ReeMoon Consulting Company W.L.L. (“ReeMoon”), responsible for the project’s business plan and overall concept; Ahmed Janahi Visions S.P.C., involved in the conceptual design, branding and marketing of the project; Sintegro Gulf W.W.L. (“Sintegro”), which will manage and maintain the development’s infrastructure and provide municipal services; and Ahmed Janahi Architects S.P.C., responsible for parts of the architectural and project management services within the development.

    The remaining 30% stake in ASIT is indirectly held by Cyclone LLC and its shareholders, an Omani company controlled by His Royal Highness Sayyid Haitham bin Tariq al Said and Mr. Anees Issa Mohamed al Zadjali, a well respected member of Oman’s business community.

    AAJ’s collaboration with Cyclone can be viewed as a strategic partnership, with AAJ contributing real estate development expertise and Cyclone providing the local relationships that are necessary for the successful realization of a development of this scale."

    It seems that the FITCH report was putting most of the weight of the project on the experience of the 70% owners AAJ Holdings..

    Any Cyclone guy wants to comment back? but he has to support his B!@$-Sh*t with facts?!?!

  15. ohhh I seem to have touched a raw nerve there Ibrahim....

    Hmmmm now let me see if I believe everything I read in the papers or on the net (BTW this is called creative journalism or senantionalism) then I would be the jerk you are calling me... LOL maybe your not looking to far from home old son....

    Mate let me explain something just cause you google something it doesn't mean it's true...LOL

    If you are so informed oh wise one care to tell me where I am wrong?

    My source's info comes from GFH (for the uninformed this means Gulf Finance House)who were the origionator of BFH... PS it's in google mate :)

    All you have said in your response is what the shareholder structure is of BCC1... what on earth has that got to do with the question I asked???

    Some how I don't think family washing is often aired on google.

    If you want to cast stones I would suggest you get your facts straight old son..

    Have a great evening


  16. Wow I seem to have have touched a raw nerve there Ibrahim.....old son...LOL

    If I believed everything I read from the papers or on the net (it's called creative journalism or sensationalism... thats how they sell papers old son)...then I think I would be the Jerk you are calling me....let me explain just cause you google something it doesnt mean it's correct mate....

    So old wise one, if I have got it all wrong as you suggest (oh thats right you didnt actually say what I got wrong) care to enlighten us with the real facts from google...LOL

    All you did was explain the shareholder structure of BCC1... wow that tells a lot..

    My source got the info from GFH (try and google this and you will see they were the originator of BFH)... some how I don't think dirty washing from the family is often hung out on google.. so it must be fabricated or is this just another form of creative journalism... LOL

    My source in Interpol never realised all the answers were on google.... dammm... how could the boys and girls at Interpol have missed that one... boy they have a lot to thank you for now .... he googled Fariborz and it looks like he is in Salt Lake City, he found Willem's dad Kanga DeRoo down in Oz... and Saleh according to google was last seen on this blog... my the modern marvels of the internet they will never cease...I feel so informed now....LOL

    Mate don't take life so literally... try smiling old son... it will make you feel better..

    Have a great evening boys

    AP (or should i say Anton)

  17. Anton,

    In your first post you said "my source is in Qatar and they got that info from a senior person in GFH", in your second post you said "My source's info comes from GFH (for the uninformed this means Gulf Finance House)who were the originator of BFH" man you need to get your shit opps I mean fact right!!

    let me in lighten you.. I am a Banker living and working in Bahrain now for most of my life and was invited for the ingratiation of the BFH in the Ritz Carlton "at that time it was called (la Merridian)". The originator of BFH is AAJ Holdings that is for a fact and it is well known here in Bahrain. AAJ Holdings proposed the idea to GFH because of family relationship between them and GFH financed it through issuing funds for the purchase of the vision and the master plan from AAJ.

    I leave it at that as I think the blog is about Blue City and not BFH..

  18. Interesting point there White Tiger... that would make sense.. from what I have heard from friends & locals (no not BCC1)...

    So reading from the above info... that was so carefully gleaned from google (as per Ibrahim) if AAJ set up the bond in Nov 2006... so that would mean that they started the project around in Mid 2007 (taking into account mobilisation of workforce)???? yes or no???

    So how come the buildings have only started going up in the last year... isn't that long after AAJ left???

    If it is then I might just employ him as that would be a superb feat of Proj Mgt... way to go AAJ...

    Cyclone any comments?


  19. Anton, you have lost your plot. We are talking about Blue City Oman and you are going in circles & circles about BFH and GFH. BFH is up & running, this project with AAJ involvement was over in 2005. Please visit AAJ Holdings offices on the 23rd Floor of NBB Towers in Bahrain and you can see the success yourself.

    Please explain and focus on Blue City Oman issue; check with the same Qatari source about Blue city, may be that source may know the truth. You are dependent on information from your sources in Qatar; you claim you are not part of Omani side and you don't live in Bahrain either.

    Over to you Anton and wish you a good day as well. You need to focus mate and come up with something more accurate, believe me you, I will sincerely appreciate your efforts of creative journalism then. With regret, what you are now doing is an evasive journalism!!


  20. Janahi is involved in many lawsuits.why? Wille D please tell us everything.-- Gaylord

  21. by the way Cyclone has 16 cases in the Omani courts..

  22. Gaylord, Tell everything? EVERYTHING? Surely not everything? OK, OK, I'll tell you what I do know, and that is... that it would clearly seem that your head is still up way up your arse.

    Willie Dryer

  23. Come on Cyclone, at least reply to Anton!

  24. Ahhh little willie,your comment completely reflects your own IQ. Yep,me thinks nada there at all-- Gaylord

  25. Gaylord, ZZZZZZZZZZzzzzzzzzzz...... Boring.

  26. Sorry was travelling....White Tiger..thanks I stand corrected my friend... I checked with my source and maybe it was my penchant for creative I mis-interpreted funding for origionator...

    One last comment on this subject and then closed from me for ever... It's interesting that AAJ didnt take any stake in BFH when he was the visionary and origionator of the project????

    Anyway as Ibrahim rightly points out enough diversion..... :).... LOL I am not being evasive.... Having been reading through all this stuff and seen the beasting everyone has been giving BCC1...

    I like being provocative and asking the alternate questions as nobody else is responding or doing so... I hate being a sheep..baaaaa.. ;)

    Anyway back to White Tigers...digging and the Fitch report... I see still no comment from that side...mmmmm.....

    Your findings would seem logical, I don't see Cyclone being property developers, so AAJ must have been responsible for the PM and developing the site... interesting that the development started raising from the ground only when he left...

    Question.... when this bond was set up it was under a different management structure - ala Prof Farsi (according to google)... ;)correct me if I am wrong??

    It would appear to me that they have now gone and that the current management team are only dealing with legacy issues handed down to them from previous management or have I got that wrong??

    AP (Anton)

  27. Nelson in WaterlooMay 12, 2010 at 11:26 AM

    Cyclone has 16 cases in the Omani courts...all of them against AAJ...what can you say about that, eh? It seems the Omanis stay quiet with AAJ nonsense but AAJ will soon end up in jail...someone is fed up with their bullying and pr games

  28. Anton, I guess you must be a newbie to these parts - as well as to the saga of the Blue City. You seem to have gotten the whole story arse-about-face chum. Please, at least gather some of the VERY basic facts before making a further fool of yourself.


  29. Anton,

    First of all, I must agree with Bobindubai, you need to get your facts right.. to answer your question, we need to remember that the Bond closure occurred in November 2006 and the news about the dispute between the shareholders and the isolation of AAJ from participating in the management of the blue city was in mid 2007 "UD please correct me if I am wrong"

    So I think that the delay in the construction of the phase 1 is the responsibility of the board of Blue City and since AAJ were not allowed to participate I think the clowns in Cyclone's should be able to answer...

    As for Nelson in Wonderland, AAJ in prison for not keeping quite and for fighting for his rights?! I think your royal highness and his boys who should be in prison as they are the ones who hijacked the project and whats worse they managed to F@#$%-up.. What a shame that this happens in Oman, where His Majesty is known to be fair!

    One question for all: The Bond Prospectus clearly mentions that AAJ is 70% owner and which was rated by FITCH and scrutinized by the number of entities that were involved let alone the Ministry of Commerce in Oman which I am sure have authenticating that AAJ does own the 70% shares.... How come after the Bond is issued Cyclone raises a court case stating that AAJ doesn't own the shares and questions their partners ownership in the project???????

    I don't know about you guys, but I rest my case as it is so clear who are the devils and who are the angels in this story!!

  30. Who is buying Blue City bonds? I just got a call from my broker at prices significantly higher than the ones posted here. Does anyone knows what is going on?


If you wish to post anonymously, please pick a nickname by selecting the Name/URL option, or at least sign off your comment with one! I will delete comments I find objectionable or needlessly inflammatory. Sorry for the word verification.... OMG the spam has gotten BAD these past 12 months... trying to avoid making one log in...