RIYADH: Saudi Telecom Co., known as stc, has partnered with its largest shareholder, the Public Investment Fund, in a SR492 million ($131 million) deal to support internet-connected devices, known as the internet of things.
In a bid to meet the rising demand for internet of things — also known as IoT — services and products, the parties agreed to establish an equally owned joint venture, telecom giant stc said in a filing.
The new venture’s initial capital can be expanded up to SR900 million three years from establishment, based on business requirements.
Local market studies indicate vast growth in the size of the IoT market in the Kingdom to potentially reach SR10.8 billion by 2025 with an annual growth rate of 12.8 percent.
stc expects the transaction to positively impact its financial statements, as it aligns with its growth strategy and a Kingdom-wide vision for a connected nation.
Yazeed AlHumied, deputy Ggovernor and head of Middle East and North Africa Investment at PIF, said: “Partnering with stc as one of the National Champions in the Information Communication Technology sector will help unlock this promising sector and contribute to PIF’s efforts to localize cutting-edge technology and knowledge in Saudi Arabia and further develop a digital economy, in line with Vision 2030 objectives.
“The Company will create significant business opportunities, high quality jobs, and improve productivity and efficiency for entities adopting IoT solutions in their operations.”
Olayan Al Wetaid, CEO of stc Group, said: “Internet of things has been identified in stc's ‘DARE 2.0’ strategy among the five strategic areas of investment. It is at our core and aligns with Saudi Arabia’s digital transformation initiatives, supported by PIF.
“Together we seek to gradually progress toward becoming a regional center for the connected digital communities in the MENA.”
