Saudi Arabia’s sovereign wealth fund, Public Investment Fund (PIF) has acquired a 25 percent stake in Emaar The Economic City (EEC), the master developer of the kingdom’s mega business zone on the Red Sea coast.
According to the statement, the Saudi wealth fund PIF has become the major shareholder in EEC. The transaction, which was completed after securing required regulatory approvals, involved the novation to PIF of $755 million (SR2.8 billion) of EEC’s debt.
According to the statement, “Post the completion of the novation, PIF has become an equity investor in EEC following the issuing of new shares by debt conversion.”
PIF’s strategic investment will allow EEC and PIF’s ecosystem to benefit from synergies in the real estate, manufacturing, logistics, and tourist sectors. Furthermore, the investment will aim to enhance Saudi Arabia’s efforts to diversify revenue streams, create strategic and operational value, improve primary infrastructure, and assist economic development by unlocking the possibilities of non-oil industries.
Aiman AlMudaifer Head – Local Real Estate Division PIF
“We are pleased to conclude this transaction. It has the potential not only to be a win-win for PIF and EEC but also to deliver wider benefits for the broader Saudi economy in line with the aims set out in Saudi Vision 2030. Our investment in EEC aligns with our broader 2021-2025 strategy, which aims to build strategic economic partnerships through PIF and unlock the capabilities of promising sectors in the Kingdom, including transportation, logistics, real estate, and tourism.”
“We welcome the Public Investment Fund as a major shareholder in EEC. This is a significant milestone for KAEC that will accelerate its role as a socio-economic development platform in Saudi Arabia and will enable it to contribute its share to the goals and objectives of vision 2030. We are excited to the prospect of this strategic partnership and its potential to contribute to the development and achievement of the national agenda,” said Mr. Cyril Piaia, Chief Executive Officer of Emaar, the Economic City.
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