Business | Investment
GCC investors to pump 1.5b riyals into new Saudi economic city
The holding company of Saudi Arabia's new economic city has won commitments of up to 1.5 billion Saudi riyals from GCC investors including the UAE, officials announced yesterday.
- By Stanley Carvalho, Staff Reporter
- Published: 00:00 July 4, 2006
- Hail is easily accessible, strategically located
- Hail is an economically strong region of Saudi Arabia that is strategically located. Its sound base in agriculture accounts for 70 per cent of the region's employment in this sector.
- Hail is equidistant from Jeddah, Riyadh and the Eastern Province and can act as a northern gateway to the Kingdom linking a number of trade routes.
- It can be reached from several Arab capitals in one hour by air.
Abu Dhabi: The holding company of Saudi Arabia's new economic city has won commitments of up to 1.5 billion Saudi riyals from GCC investors including the UAE, officials announced yesterday.
They said the balance of the holding company's capital of 5 billion riyals would be raised through a public share offering and from investors in the Kingdom.
"The holding company for the new economic city in the northern region of Saudi Arabia is being created currently with a capital of five billion riyals. The new company will become operational in the third quarter of this year," said Esam Janahi, Chief Executive, Gulf Finance House, one of core regional investors.
"Strategic investors from the GCC will contribute up to 30 per cent of the capital which is 1.5 billion riyals. Another 30 per cent will be raised through an initial public offering and the remaining from partners in Saudi Arabia," he told Gulf News after project details were unveiled.
The Prince Abdul Aziz Bin Mousaed Economic City is the second in a series of economic cities planned by the Saudi Arabian General Investment Authority and private sector investments totalling 30 billion riyals is expected to be pumped into this project's first phase over the next 10 years.
Saudi Arabia's Rakisa Holdings is the lead developer and core investors include Gulf Finance House, Tanmiyat Group, Abu Dhabi Investment House (ADIH) and others.
Covering an area of some 150 million square metres, the new city will incorporate a cluster-based development.
"Saudi Arabia is a big market that has opened up and the concept of economic city has unique features. We are happy to be part of this project and we will go either through private equity or other instruments," said Rashad Janahi, Chief Executive, ADIH.
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