6 key overseas investments by the Saudi wealth fund

Saudi Arabia is boosting the power of the Public Investment Fund (PIF), as part of efforts to diversify its economy away from oil. Under the Vision 2030 initiative unveiled last year, the kingdom aims to increase the fund’s assets from SAR 600 billion to over SAR 7 trillion.

Argaam takes a look at some of the PIF’s key investments overseas:

1) The fund signed a non-binding memorandum of understanding (MoU) with Japan-based Softbank Group last October to set up a technology investment fund that could grow as large as $100 billion. PIF plans to be the largest investor in the fund – named Softbank’s vision – with an investment of $45 billion over the next five years, the Saudi state news agency (SPA) reported.

2) US ride-hailing service Uber raised $3.5 billion from the PIF in June 2016. The investment was part of a financing round that valued Uber at $62.5 billion, making it the most highly valued venture capital-backed company in the world.

3) The PIF teamed up with billionaire Dubai businessman, Mohamed Alabbar, and other investors last November to launch Noon.com, a new e-commerce platform, with $1 billion in seed capital. The Saudi wealth fund will own a 50 percent stake in the platform, while Alabbar and other regional investors will own the other half.

4) The fund is also planning to buy a 50 percent stake in Adeptio – the Gulf-based investment firm that recently bought Kuwait Food Co. (Americana) – from Alabbar, it was reported last November. The stake will be purchased for an undisclosed amount. 

5) The PIF signed a memorandum of understanding (MoU) last March to invest up to SAR 30 billion ($8 billion) in Egypt’s energy, tourism and housing sectors, local media reported, citing a ministry spokesperson.

6) Last October, the PIF inked an agreement with Jordan’s Aqaba Special Economic Zone Authority (ASEZA) for a development project in Aqaba city, according to a joint statement. Under the preliminary deal, the Saudi sovereign wealth fund will team up with Jordanian banks and financial institutions to set up and register several investment firms in the Jordanian kingdom.

Earlier in 2016, Saudi Arabia and Jordan agreed to establish a joint coordination council to oversee PIF investments in the latter, which would commit billions of dollars to investments in the Hashemite kingdom, Bloomberg reported in April. 

Write to Jerusha Sequeira at jerusha.s@argaamnews.com