JEDDAH: Saudi Arabia is set to generate nearly SR3 billion ($800 million) in proceeds from the privatization of two flour mills.
The National Center for Privatization and PPP (NCP) and the Saudi Grains Organization announced on Wednesday that privatization had been completed for two state-owned milling companies as part of a bidding process that ended on April 19.
The Second Milling Company was awarded to a consortium of Abdul Aziz Al-Ajlan Sons for Commercial and Real Estate Investments Company, Sulaiman Abdul Aziz Al-Rajhi International Company, National Agricultural Development Company and Olam International Limited. This consortium submitted a bid totaling SR2.138 billion.
The Fourth Milling Company was awarded to a consortium consisting of Allana International, Abdullah Al-Othaim Markets and United Feed Manufacturing Company, following a bid totaling SR859 million.
Saudi Arabia is considered one of the biggest markets for flour in the Middle East and North Africa. The first phase of the sector’s privatization process was completed last December, with the First and Third Milling Companies being transferred to winning investors for a total of SR5.7 billion.
The full privatization of the flour milling sector comes in line with Saudi Arabia’s Vision 2030 economic mandate to increase private sector investment and diversify the economy away from a dependence on oil. The bidding for the privatization of the flour milling companies was launched in July 2019.
Last month, the Saudi Cabinet announced plans to privatize 16 key industries. “We are working with all the sectors targeted for privatization. Several projects have been recently selected and launched in … health, education, transport, municipalities, environment, water and agriculture, and human resources and social development,” Hani Al-Saigh, director-general of strategic communication and marketing at the NCP, told Arab News.
In January, the NCP announced it had raised SR3 billion in revenue from the sale of state assets in 2020 and aimed to make approximately SR15 billion or more in 2021.