JEDDAH: In a major strategic move, 37 contracting firms have agreed to merge and form a giant national company with a capital of about SR5 billion, Al-Eqtisadiah business daily reported yesterday.
Dr. Abdul Aziz Al-Atishan, chairman of Atishan Group, said the move would empower the company to grab a major share of SR1.9 trillion projects to be implemented in Saudi Arabia and other Gulf countries during the next 10 years. Al-Atishan, who is also the founding committee chairman of the new company, said the agreement on merger was reached during a meeting of contractors at Asharqia Chamber in Dammam.
“More than 50 businessmen and company owners attended the meeting,” he said, adding that about 15 firms in the Eastern Province have expressed their intent to join the new company.
He said the new company, to be based either in Riyadh or Dammam, would have a capital of SR3 billion to SR5 billion. “We have already opened a bank account for the company and started establishment procedures.” The main objective of the new company is to carry out large-scale projects within the Kingdom and abroad competing with major international companies.
Al-Atishan said the new company would buy foreign companies or establish alliance with them to implement giant projects in energy, water, electricity, petrochemical, industrial and real estate sectors. “We’ll complete the study on the new company within two months and fix the contribution of shareholders to capital and how many percentage of the capital to be floated for public subscription,” he said, hoping the company would start functioning in the beginning of next year.
The new company would first concentrate on projects within the Kingdom before eyeing on those in other Gulf countries. “There are more than 1,000 giant projects in oil and gas, desalination, electricity and real estate in the Gulf countries,” he said.
“These projects are to be completed within the next 10 years. About 40 percent of these projects are in the Kingdom,” he pointed out. He estimated the total cost of these projects at more than SR1.9 trillion. “We hope the government will support our company by awarding its projects,” he added.
Saudi Arabia has launched four mega economic cities in Rabigh, Hail, Madinah and Jizan, which offer a lot of opportunities for Saudi and foreign contractors.