Saudi PIF fund may invest in Lulu group; Initial talks started

By Rahul Vaimal, Associate Editor
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LuLu Hypermarket
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According to the reports, the Saudi sovereign wealth fund, Public Investment Fund (PIF), is in active talks to acquire a stake in the Lulu Group International supermarket chain.

As negotiations were in the early stages, it was not clear how large a stake PIF would like to buy or whether the talks would lead to a final deal.

PIF, which manages assets amounting to $360 billion, declined to comment about the deal.

Lulu’s Director of Marketing & Communications, V. Nandakumar said in an email response, “As a matter of policy, we never comment on market relations rights and media rumors.”

According to the sources, Abu Dhabi state-owned holding company ADQ invested $1 billion in Lulu earlier this year. But ADQ did not respond to request for comment about the investment.

The PIF is the main strength behind the kingdom’s Vision 2030 strategy to diversify the economy, with the authorities planning to make it the largest sovereign wealth fund in the world.

The Saudi government wants to expand the country’s retail sector as part of a move to create one million jobs by 2020.

PIF invested $500 million in Noon’s e-commerce company, which launched operations in Saudi Arabia shortly afterward. It also invests indirectly in the IPO of Arabian Centres Group, the Saudi mall operator.

Reliance was also approached by PIF to buy a stake in the Indian billionaire Mukesh Ambani’s Reliance Industries Limited retail arm, digital unit Jio Platforms.

Since 2015, the company, whose board is chaired by Crown Prince Mohammed bin Salman of Saudi Arabia, has been a more involved investor, taking a $3.5 billion stake in Uber Innovations and investing $45 billion in the inaugural technology fund for Softbank.

LuLu Group

LuLu Group International, headquartered in Abu Dhabi is an Indian-owned multinational conglomerate that runs a chain of hypermarkets and retail companies, with an annual turnover of $7.4 billion. It has operations in Egypt, India, Indonesia and Malaysia, as well as Saudi Arabia and other Gulf states.