From tennis to paper, PIF pushes ahead with its diverse investments strategy in 2024

From tennis to paper, PIF pushes ahead with its diverse investments strategy in 2024
The sovereign wealth fund has continued with the momentum built up in 2023, which saw it make investments in companies as diverse as London’s Heathrow Airport and Rocco Forte Hotels. (Shutterstock)
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Updated 27 May 2024
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From tennis to paper, PIF pushes ahead with its diverse investments strategy in 2024

From tennis to paper, PIF pushes ahead with its diverse investments strategy in 2024
  • Sovereign wealth fund continues to drive forward Kingdom’s economic diversification agenda

RIYADH: Tennis, tech and paper production are just some of the areas Saudi Arabia’s Public Investment Fund has reached into so far in 2024, as the body continues to drive forward the Kingdom’s economic diversification agenda.

The sovereign wealth fund has continued with the momentum built up in 2023, which saw it make investments in companies as diverse as London’s Heathrow Airport and Rocco Forte Hotels.

Its activities since the turn of the year saw PIF revise its asset size on its website, reaching $925.2 billion after it climbed to the fifth spot in a ranking of state-owned investment organizations by the Sovereign Wealth Fund Institute.

This monumental rise in the fund’s standing followed its procurement of an additional 8 percent stake in Aramco, boosting its shareholding’s estimated value to $328 billion.

Here are some of the key announcements made by the wealth fund so far in 2024

PIF’s deal with Bahrain Mumtalakat to enhance investments

One of the primary deals signed by PIF in the first quarter was a memorandum of understanding inked with Bahrain’s sovereign wealth fund Mumtalakat in March.

The agreement aims to expand cooperation between the two parties, enable new and promising investment prospects in Bahrain, and create opportunities for private companies in both countries.

Yazeed Al-Humied, deputy governor and head of MENA Investments at PIF, said the deal supports the wealth fund’s objectives of building long-term strategic regional partnerships that bring additional value to local economies.

“It also enables the achievement of sustainable returns that further contribute to maximizing PIF’s assets and diversifying the economy in line with the objectives of Saudi Vision 2030,”
said Al-Humeid.

PIF acquired 40 percent stake in Zamil Offshore

In February, the wealth fund acquired a 40 percent stake in Zamil Offshore Co., a significant move that could boost marine support services in Saudi Arabia.

In a press statement, PIF revealed that this investment is part of the fund’s broader strategy to contribute to the development of the Kingdom’s energy base.

Zamil Offshore Co. is one of the largest Saudi-based offshore support providers, operating over 90 vessels in the Arabian Gulf.

Bakr Al-Muhanna, head of the Transport and Logistics Sector in Middle East and North Africa Investments at PIF, said that this investment will strengthen the offshore support industry, contributing to the fund’s wider efforts to develop Saudi Arabia’s energy ecosystem.

PIF’s efforts to accelerate growth of global tennis sports

In February, the wealth fund signed a multi-year strategic agreement with the Association of Tennis Professionals aimed at accelerating the growth of the sport globally.

“Through our collaboration with ATP, PIF will be a catalyst for the growth of the global tennis landscape, developing talent, fostering inclusivity and driving sustainable innovation. This strategic partnership aligns with our broader vision to enhance quality of life and drive transformation in sport both within Saudi and across the world,” said Mohamed Al-Sayyad, head of corporate brand at PIF.

Under the deal, PIF will leverage ATP’s expertise to develop further opportunities for young Saudis in wtennis, including the development of state-of-the-art facilities and ensuring the availability of necessary coaching in the Kingdom.




In February,  PIF signed a multi-year strategic agreement with the Association of Tennis Professionals aimed at accelerating the growth of the sport globally. (Supplied)

 

The launch of Alat

Another significant development in February was the launch of Alat, a PIF firm aimed at turning Saudi Arabia into a global hub for sustainable technology manufacturing.

The company will prioritize constructing products tailored for local and international markets across seven strategic business units. These include advanced industries and semiconductors, smart appliances and health solutions, as well as smart devices and building technologies.

Alat will also manufacture more than 30 product categories that will serve vital sectors, including robotic and communication systems, advanced computers and digital entertainment, as well as advanced heavy machinery used in construction, building and mining.

Acquisition of Mepco in diversification push

In January, PIF bought a 23.08 percent stake in the Middle East Paper Co. as the fund continued expanding its investments in the Saudi economy’s primary sectors.

According to a statement, the body acquired the stakes by increasing capital and subscribing to new shares in Mepco. Muhammad Aldawood, PIF’s head of the industrials and mining sector in the Middle East and North Africa region, said the fund’s investment in Mepco reflects the attractive growth opportunities in promising sectors such as recycling, retail, and building materials.

The fund added that PIF’s investment in Mepco will support the private sector in Saudi Arabia, boost local content, increase exports as well as improve quality and competitiveness.

Sami Al-Safran, CEO of MEPCO, said that PIF’s investment will help the company become a national champion in the recycling industry.

“PIF’s investment further enables the implementation of our expansion strategy and captures significant growth potential, both locally and regionally,” said Al-Safran.




In January, PIF bought a 23.08 percent stake in the Middle East Paper Co. as the fund continued expanding its investments. (Supplied)

Completion of the acquisition of Dubai-based Kent

In February, Saudi contractor Nesma & Partners, backed by PIF, completed the acquisition of Kent, based in Dubai, after signing an agreement in 2023.

In a statement, Nesma said that the acquisition aligns with the company’s strategic growth strategy and aims to position the firm as a global leader in the construction industry.

“The acquisition of Kent represents a significant milestone for Nesma & Partners, reinforcing our commitment to expanding our capabilities and enhancing our position in the global market,” said Samer Abdul Samad, president and CEO of Nesma & Partners.

According to the acquisition details, Kent and Nesma do not plan to integrate operations, and both firms will continue their existing projects.

PIF aims to strengthen electric motorsports sector

In January, the wealth fund signed a multi-year agreement named Electric 360 with Formula E, Extreme E and E1 to support the growth of electric motorsports and their role in advancing the future of electric mobility.

In a press statement, PIF said the partnership will drive technological innovation and revolutionize sustainable transport and future mobility, ultimately reducing carbon emissions.

“Together with these championship series, Electric 360 will redefine electric sport and supercharge its growth, delivering tangible impact aligned with our broader business strategy as PIF drives new green technological innovation that will be the cornerstone of future electric mobility,” said Mohamed Al-Sayyad, head of corporate brand at PIF.


Saudi Arabia’s PIF showcases achievements in balancing biodiversity conservation and investments

Saudi Arabia’s PIF showcases achievements in balancing biodiversity conservation and investments
Updated 13 June 2024
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Saudi Arabia’s PIF showcases achievements in balancing biodiversity conservation and investments

Saudi Arabia’s PIF showcases achievements in balancing biodiversity conservation and investments

RIYADH: Saudi Arabia’s sovereign wealth fund has detailed its successful balancing of biodiversity conservation with its investment initiatives.

The Public Investment Fund highlighted its undertakings spanning diverse sectors, with a focus on sustainable, eco-friendly, and luxurious tourism, as well as responsible mining practices.

According to the UN, human activity, driven largely by unsustainable practices, is the primary driver behind an ongoing biodiversity crisis, with 44,000 species endangered, 70 percent of coral reefs at risk, and fertile land loss surging by 29 percent since 2000.

Saudi Arabia, home to a vast array of plant and animal species, is actively addressing these challenges. 

In a statement, PIF emphasized its role as a major contributor to the Kingdom’s goals for protecting the environment, climate, natural resources, and biodiversity.

The fund pointed out that “it is possible to align successful and realist investment with environmental priorities.”

This holistic approach also promotes responsible investment in protected areas, particularly in nations rich in biodiversity – a commitment echoed by PIF as it strives to achieve Saudi Arabia’s environmental and biodiversity conservation goals.

One of the Kingdom’s wealth fund’s initiatives is Red Sea Global, which was established to develop tourist destinations in harmony with sustainable practices. 

The giga-project has conducted extensive baseline studies of marine biodiversity in the Red Sea and Amala regions to inform strategic planning aimed at nurturing the region’s tourism sector while preserving its ecological balance.

Building on its environmental database, Red Sea Global aims to achieve a 30 percent positive biodiversity conservation return by 2040.

Its initiatives include species protection and habitat restoration efforts, supported by accolades such as the “Regional Sector Leader” award from the Global Real Estate Sustainability Index.

PIF is keen to preserve Saudi Arabia’s wide range of biodiversity. Supplied

PIF’s commitment extends beyond tourism to initiatives like Dan Co., which is dedicated to eco-friendly tourism projects across Saudi Arabia. 

Launched in December 2023, Dan Co. aims “to achieve leadership in the field of rural and environmental tourism” through partnerships with local communities, offering visitors experiences that showcase Saudi Arabia’s diverse cultural values.

Moreover, Soudah Development Co. focuses on creating luxury mountain tourism destinations in Asir, integrating environmental sustainability with cultural preservation and community empowerment. 

By partnering with local wildlife and vegetation conservation authorities, Soudah Development plays a crucial role in advancing Saudi Arabia’s ambitious Green Initiative to combat climate change and promote sustainable development.

In tandem with these efforts, mining company Ma’aden has embarked on environmental undertakings, including projects for vegetation improvement and mangrove preservation along coastal areas—crucial for community livelihoods and ecological stability. 

Ma’aden’s commitment to biodiversity management sets benchmarks for responsible mining practices across its operational spectrum.

According to PIF, these collaborative models illustrate that robust investment strategies can coexist with environmental conservation imperatives. 

The fund stated: “PIF is moving toward achieving sustainable economic and social development capable of ensuring continued economic growth while protecting natural diversity through an integrated system of vital initiatives and projects that shape the future for generations to come.”

The Kingdom boasts rich biodiversity, including 499 species of birds, 117 mammals, 107 reptiles, 266 coral, 1,230 types of fish, eight amphibians, and over 2,400 flowering plants, according to the National Center for Wildlife.

Recent events, such as Saudi Arabia’s participation at the High-Level Event on Ocean Action in San José, Costa Rica, on June 10, underscore the Kingdom commitment’s in this field. 

The event, attended by the Minister of State for Foreign Affairs and Climate Affairs Envoy Adel Al-Jubeir, focused on sharing expertise in ocean governance and safety, addressing critical challenges marine environments face. 

At the accompanying exhibition, the Saudi delegation showcased national initiatives under the banner of “Blue Saudi,” highlighting efforts such as assessing and rehabilitating environmental habitats in the Red Sea and Arabian Gulf. 

Emphasizing the importance of preserving biodiversity, the delegation presented plans to designate protected areas and ambitious programs to plant mangrove trees and combat plastic pollution through legislative measures and waste management initiatives. 

Saudi Arabia reiterated its commitment to sustainable practices under the UN Convention on the Law of the Sea, underscoring its dedication to conserving marine biodiversity.

In May of this year, the King Salman bin Abdulaziz Royal Natural Reserve in Saudi Arabia achieved accreditation as “the first major biodiversity site in the Kingdom,” confirmed by Key Biodiversity Areas. 

The reserve, spanning 130,700 sq. km, meets three global standards, including the presence of endangered species, qualifying it for this prestigious recognition, which coincides with the International Day for Biological Diversity on May 22 each year.

Managed by the King Salman bin Abdulaziz Royal Natural Reserve Development Authority, the Saudi reserve aims to safeguard endangered species, enhance natural habitats, promote environmental awareness, and mitigate threats from natural and human factors. 

This area is recognized as the largest nature reserve in the Middle East.


Closing Bell: Saudi main index closes in red at 11,498 

Closing Bell: Saudi main index closes in red at 11,498 
Updated 13 June 2024
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Closing Bell: Saudi main index closes in red at 11,498 

Closing Bell: Saudi main index closes in red at 11,498 

RIYADH: Saudi Arabia’s Tadawul All Share Index dipped on Thursday, losing 152.88 points, or 1.31 percent, to close at 11,498.93.   

The total trading turnover of the benchmark index was SR10.97 billion ($2,92 billion) as 62 of the listed stocks advanced, while 165 retreated.    

Similarly, the MSCI Tadawul Index decreased by 18.86 points, or 1.29 percent, to close at 1,437.54. 

However, the Kingdom’s parallel market Nomu increased by 104.55 points, or 0.39 percent, to close at 26,753.99. This comes as 30 of the listed stocks advanced, while as many as 27 retreated.  

The top-performing stock of the day was Rasan Information Technology Co., which saw its share price surge by 30 percent to SR48.10. 

Other top performers included Al Taiseer Group Talco Industrial Co. and Al Moammar Information Systems Co., whose share prices soared by 14.42 percent and 7.24 percent, to stand at SR49.20 and SR163, respectively. 

In addition to this, other top performers included Saudi Cable Co. and Chubb Arabia Cooperative Insurance Co. 

The worst performer of the day was Saudi Manpower Solutions Co., with its share price dropping by 8.51 percent to SR8.28. 

Other poor performers included ACWA Power Co. and Miahona Co., with their share prices declining by 5.31 percent and 5.19 percent to reach SR331.80 and SR21.56, respectively. 

Furthermore, other underperforming stocks included Sahara International Petrochemical Co. and Savola Group. 

On the announcements front, Rasan Information Technology Co. surged in its Riyadh debut, raising SR841 million with its shares peaking at SR48.1, a 30 percent increase from the offer price of SR37. 

Bloomberg reported that the IPO saw strong demand, with orders totaling $29 billion, making it oversubscribed 129 times, reflecting Saudi Arabia’s push to diversify its stock exchange beyond traditional sectors like banking and industry.  

“Rasan, which operates online insurance platforms such as Tameeni and Treza, will be among the first fintech firms to go public in the kingdom, which has only seen a few tech listings so far,” Bloomberg added. 

Besides Rasan, buy-now-pay-later firm Tabby and online cosmetics retailer Nice One are considering IPOs, according to Bloomberg News. 


Flyadeal receives first fully-owned aircraft in landmark moment 

Flyadeal receives first fully-owned aircraft in landmark moment 
Updated 13 June 2024
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Flyadeal receives first fully-owned aircraft in landmark moment 

Flyadeal receives first fully-owned aircraft in landmark moment 

RIYADH: Saudi Arabia’s low-cost airline flyadeal has taken delivery of its first-ever wholly-owned aircraft in a “milestone” moment, according to the CEO.

The airline received the Airbus A320neo, named Al Sama after an Arabic constellation star in Toulouse, Airbus’ main assembly site.

This acquisition is also the company’s first new aircraft in 2024 and marks the beginning of a delivery plan that includes adding four vessels this year and eight A320neos in 2025.

The newly acquired aircraft will join the airline’s expanding domestic and international route network, serving nearly 30 destinations across Saudi Arabia, the Middle East, Europe, and North Africa.

Flyadeal CEO Steven Greenway, along with colleagues Ahmed Bakadam, director of maintenance and engineering, and Ali Al-Zahrani, senior manager technical fleet, gathered in France for the official exchange. 

“The addition of aircraft number 33 represents a symbolic double milestone for flyadeal, bringing in our first fully owned aircraft and inducting the first new aircraft into the fleet this year. Until now all flyadeal aircraft are leased,” Greenway said.

He added: “With a plan targeting around 50 aircraft by the end of 2025 that will double to 100 by 2030, we are on course for a dynamic delivery schedule over the next few years. An incredible growth path that is being accelerated by the shear demand for inbound and outbound travel catering to a diverse profile of travellers.”

Greenway expressed satisfaction with their partnership with Airbus and highlighted the aircraft’s comfort and eco-friendliness, emphasizing their commitment to providing passengers with a positive flying experience. 

As part of future fleet requirements, flyadeal placed its largest ever order last month for a further 51 Airbus A320 family aircraft comprising 12 A320neos and 39 larger A321neos. 

Sporting a spacious cabin of 186 seats in a three–three configuration that features seating of the highest standards and specifications for a low-cost airline and larger than normal overhead bins, the A320neo is the backbone of flyadeal’s fleet, which is among the youngest in the industry averaging just over two years old. 


Saudi Aramco partners with NextDecade for 20-year LNG supply deal

Saudi Aramco partners with NextDecade for 20-year LNG supply deal
Updated 13 June 2024
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Saudi Aramco partners with NextDecade for 20-year LNG supply deal

Saudi Aramco partners with NextDecade for 20-year LNG supply deal

RIYADH: Energy giant Saudi Aramco has signed a non-binding agreement with US-based NextDecade to supply 1.2 million tonnes per annum of liquefied natural gas for 20 years.

According to a press statement, LNG will be supplied from the fourth liquefaction train at NextDecade’s Rio Grande Facility at the Port of Brownsville in Texas. 

“Aramco and NextDecade are currently in the process of negotiating a binding agreement, and once executed, the effectiveness of which will be subject to a positive final investment decision on Train 4,” said Aramco in the press statement. 

Aramco’s Upstream President Nasir K. Al-Naimi said the company is exploring opportunities to expand its presence in the global energy market. 

“We look forward to finalizing the terms of a long-term LNG offtake agreement with NextDecade as we explore opportunities to expand our presence in international energy markets,” said Al-Naimi in the release.  

“We expect LNG to play an important role in meeting the rising demand for secure and efficient energy,” he added. 

Matt Schatzman, chairman and CEO of NextDecade, said he is “pleased to have reached a heads of agreement with Aramco for LNG from Train 4, as Aramco seeks to expand its LNG portfolio.” 

Saudi Aramco, one of the biggest energy firms in the world, has been taking crucial steps in recent months to expand its global presence. 

In May, Aramco completed the acquisition of a 40 percent stake in Gas & Oil Pakistan, officially marking the Saudi company’s entry into Pakistan’s fuel retail market.

In April, Saudi Aramco disclosed that it is in talks to acquire a 10 percent stake in China’s Hengli Petrochemical, aiming to strengthen Aramco’s growing downstream presence in the Asian country. 

In February, speaking at the India Energy Week in Goa, Faisal Faqeer, Saudi Aramco’s senior vice president of liquids to chemicals development downstream, revealed that the energy giant is engaged in investment discussions with several Indian companies. 

Earlier this month, Saudi Aramco also retained the leading spot in Forbes Middle East’s Top 100 listed companies for 2024, with $660.8 billion in assets and $1.9 trillion in market value.

Moreover, Saudi Aramco continued its strong fiscal performance in the first quarter of this year amid global economic uncertainties and geopolitical tensions. 

On May 12, Saudi Aramco revealed that its net profit for the first quarter of this year reached $27.27 billion, representing a rise of 2.04 percent compared to the last three months of 2023. 

According to a statement, the oil firm’s total revenue for the three months to the end of March stood at $107.21 billion, with total operating income for the period reaching $58.88 billion.  


NEOM welcomes Capella’s wellness-focused resort in Magna region

NEOM welcomes Capella’s wellness-focused resort in Magna region
Updated 13 June 2024
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NEOM welcomes Capella’s wellness-focused resort in Magna region

NEOM welcomes Capella’s wellness-focused resort in Magna region

RIYADH: Saudi Arabia’s future city, NEOM, is poised to welcome an 80-room wellness-focused resort after Capella Hotels and Resorts announced its first coastal destination at Elanan in the Magna region. 

This new offering from the Singapore-based hospitality group provides a fresh option for travelers to the area, supporting the Kingdom’s ambitions to establish itself as a tourism hub in the region. 

The resort is part of the sustainable development unfolding in northwest Saudi Arabia, the company said in a press release. 

Cristiano Rinaldi, president of Capella Hotel Group, said: “Combining Saudi Arabia’s breathtaking natural landscapes with NEOM’s innovative technology, we are poised to provide guests with an unparalleled wellness experience that promises delight and discovery.”  

He added: “This sanctuary will elevate Capella Hotels and Resorts’ esteemed wellness offering, featuring a curated series of exciting programs.” 

In February, NEOM announced Elanan, a new guest retreat focused on luxury and well-being experiences, nestled in a natural setting. 

This announcement adds to NEOM's recent sustainable tourism destinations in the Gulf of Aqaba, including Leyja, Epicon, and Siranna. It also includes Utamo and Norlana, along with Aquellum, Zardun, and Xaynor. 

Jeremy Lester, NEOM's executive director for Magna, expressed delight in collaborating with Capella Hotels and Resorts at Elenan. He described it as a “stunning haven that blends luxury with the spectacular landscape,” offering an exclusive sustainable retreat dedicated to holistic wellness. 

“It’s a fusion of aligned values and aspirations. Together, we’ll craft an environment to set a new standard in luxury guest experiences.” Lester said. 

The release emphasized that guests experience tranquility in a modern environment that blends contemporary design with natural beauty. 

It also noted that Capella enhances hospitality with a focus on wellness and innovative design through Capella Wellness, providing a relaxing sanctuary infused with modern aesthetics. 

On June 5, NEOM revealed its luxury lifestyle destination Magna. The development is part of NEOM’s sustainable portfolio in the region, focusing on integrating cutting-edge technology, world-class architecture, and modern amenities with the natural environment, according to a press release.