Business | General
Saudi contracting firms plan to merge
Saudi contracting companies which do not have the financial capability to take advantage of the current economic boom in the Kingdom by winning contracts for mega projects are trying to merge.
- By Mariam Al Hakeem, Correspondent
- Published: 00:15 June 29, 2008
Riyadh: Saudi contracting companies which do not have the financial capability to take advantage of the current economic boom in the Kingdom by winning contracts for mega projects are trying to merge.
As many as 37 small contracting companies have agreed to establish a giant national contracting company specialised in all types of construction work.
The company's initial capital will rangie between three billion riyals and five billion riyals.
The founders will soon take a final decision regarding the headquarters of the company, which will start operation by the beginning of next year.
Dr Abdul Aziz Al Otaishan, chairman of the board of directors of Al Otaishan Contracting Group, said that about 37 contracting companies working in building construction and manufacturing of construction materials have taken the decision to create a big company capable of implementing mega projects.
"The company will most probably be headquartered either in Riyadh or the Eastern Province," he said.
More than 15 contracting companies in the Eastern Province have expressed their readiness to join the new company.
"We plan to bring all the contracting companies under the umbrella of the parent company," he said.
He said the company will start implementing projects in the Kingdom in the initial stage and then will explore the prospect of expanding its activities to other Gulf states.
The Gulf region is witnessing the implementation of more than 1,000 giant projects worth a total of $1.9 trillion over the next 10 years.
"About 40 per cent of these projects are in oil, gas, desalination, electricity and real estate are concentrated in Saudi Arabia,," Al Otaishan said.
We plan to bring all the contracting companies under the umbrella of the parent company."
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