SAGIA in $1.3bn deal to build economic city

MEGA-DEAL: Al-Mal has signed a $1.3 billion deal with SAGIA to build the economic city in Hail. (Google Maps)

Kuwait's Al-Mal Investment Co., a firm controlled by the family-owned conglomerate Kharafi Group, said it signed a deal with the Saudi Arabian General Investment Authority (SAGIA) to develop an economic city in the kingdom.

Under the agreement, Al-Mal will set up a Saudi firm with a capital of 5 billion Saudi riyals ($1.33 billion), in which it will own a significant stake and sell a stake to the public, it said in a statement on the Kuwait bourse website.

Other governmental authorities will also own a stake in the firm, which will be set up within six months, Al-Mal said without being specific.

Developing the real estate project, which is to build the northern Saudi economic city of Hail, will be completed before 2025. The final stakes for shareholders in the new firm will be decided upon later, it added.

Saudi Arabia is developing four economic cities, at Rabegh near Jeddah, Jizan, Medina and Hail, in an effort to diversify its oil-based economy, find Saudis jobs, create a modern education system and attract foreign investment.

The deal includes developing industrial and residential areas, a power station and medical services for the city among other projects, it said. (Reuters)

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