JEDDAH, 1 October 2006 — Commerce and Industry Minister Hashim Yamani yesterday announced the formation of Emaar Economic City as a public joint stock company with a capital of SR8.5 billion and 850 million shares with a nominal value of SR10 each.
Based in Jeddah, the company was established by UAE real estate giant Emaar Properties and Saudi investors to develop the SR100-billion King Abdullah Economic City in Rabigh, some 200 kilometers northwest of Jeddah.
According to a statement issued by the ministry, the new company is licensed to carry out real estate development and infrastructure projects including economic cities and promote, market and sell real estate properties owned by the company.
Founders have subscribed to 70 percent of the company’s shares while the remaining 30 percent were sold in an initial public offering to Saudis in August this year. The IPO was oversubscribed fetching nearly SR7.2 billion. More than 10 million Saudis bought the company’s shares.
EEC’s fully underwritten IPO, open only for Saudi nationals, had on offer 255 million shares at a nominal value of SR10 each, proceeds of which will be used toward the development of the King Abdullah Economic City (KAEC). “The overwhelming response to the IPO is a direct result of the successful vision of Custodian of the Two Holy Mosques King Abdullah to transform the economy of the Kingdom to be ready to leverage a host of opportunities aimed at the prosperity of its citizens,” said EEC Chairman Mohamed Ali Alabbar.
“The invaluable support provided by Saudi Arabian General Investment Authority (SAGIA) in the creation of the EEC and in making the world-class KAEC project a reality, has strengthened our resolve to move ahead with confidence,” he said.
The King Abdullah Economic City will closely integrate itself into the Kingdom’s on-going drive to expand the economy, create employment opportunities for its youthful population and function as a catalyst to attract foreign investment, global trade, commerce and industry. Based on initial forecasts, the project and its several components will create up to 500,000 employment opportunities in the various industries and service-oriented companies that will open in the city.
The economic city will have six distinct components — a modern world-class seaport, industrial district, financial island, education zone, resorts and the residential area. Completion of the overall project will be done in stages with the first batch of businesses and residents moving into the city in a period of 24 to 36 months.