JEDDAH, 25 November — Saudi companies licensed to provide Umrah services are now seriously thinking of merger following big losses — estimated at more than SR150 million — suffered by them during the past three months.
Speaking to Arab News on the sidelines of an annual meeting, representatives of the companies confirmed a plan to merge the companies to strengthen their position in the market. They said some sort of a merger agreement has already been reached.
The companies said business was deeply affected by the Sept. 11 attacks in the United States and the subsequent events. The airliner attacks on New York and Washington crippled the industry as many people are now afraid of air travel.
Conflicts between Saudi companies and their foreign agents have also affected business.
Yasser Al-Kholi, executive president of Labbaik, one of the companies specialized in Umrah and Haj services, called for more cooperation between the companies to make maximum use of the new Umrah system.
He said more than 900,000 pilgrims had come to perform Umrah this year under various Umrah companies.
The government has licensed 250 companies to offer the service. But nearly 15 percent of them have yet start their operations.
"The market is large enough to accommodate new companies. However, they should conduct necessary feasibility studies before entering the market in order to avoid losses," he added.
Al-Kholi said there was good cooperation among new companies.
The Foreign Ministry’s decision to extend the period of issuing Umrah visas until Ramadan 10 had helped the companies to increase their business. The decision allowing pilgrims to stay until Shawwal 15 will also benefit the companies.
The annual meeting, organized by the Labbaik company, was aimed at bringing the views of the Umrah companies closer and avoid past mistakes. Officials from the King Fahd Haj Research Institute also attended the meeting.
The Ministry of Haj recently closed and fined 25 Umrah companies for neglecting their contractual obligations to foreign pilgrims or involvement in shady dealings.
Muhammad Saleh Bantan, deputy minister for Umrah affairs, said the ministry has beefed up inspections around the squares of the Haram Mosque and its neighborhood to round up pilgrims who ran away from the firms which arranged their journey to the Kingdom.
The move follows complaints from many Umrah establishments that several pilgrims disappeared after their arrival in the Kingdom. There were recent media reports about hundreds of pilgrims found loitering on the pavements of Jeddah and Makkah.
According to the new rules, the Umrah companies must ensure the return of pilgrims to their respective countries after performing their religious rites.
