PIF wants in on Saudi Binladin Group: The Public Investment Fund (PIF) is planning to acquire a stake in the Kingdom’s largest construction conglomerate, Saudi Binladin Group (SBG), Bloomberg reported last week, citing sources it says are close to the matter.

What we know: The PIF is reportedly eyeing a chunk of or all of the Finance Ministry’s 36% stake in the construction giant, the sources said. It is working with Morgan Stanley on the potential transaction, they added.

Two-way benefits: The interest comes as the PIF looks to strengthen the domestic construction industry as the Kingdom pushes forward with the development of gigaprojects. The drive is taking on new urgency as we prepare to host both Expo 2030 and the 2034 Fifa World Cup. The potential acquisition could come as a lifeline for SBG’s recovery from years of losses and debt. It hired Houlihan Lokey in 2020 to advise on the restructuring of some USD 15 bn worth of debt

A key player: The SBG has been the Kingdom’s largest building contractor since it was founded in 1931. It helped build the King Abdulaziz International Airport, King Saud University, King Abdullah Financial District, King Abdullah Economic City, and Al Faisaliyah tower, among other projects, according to its website. It also helped with development and expansion works at the two holy mosques in Makkah and Madinah.

BACKGROUND- The PIF invested in a number of construction outfits last year, spending over USD 1.3 bn to acquire minority stakes in Nesma & Partners Contracting, ElSeif Engineering Contracting, AlBawani Holding, and Almabani General Contractors.

Tags: