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Sun 31 Mar 2019 03:07 PM

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Kingdom Holding to invest Careem proceeds in Saudi, Europe

Saudi investment firm owned by Prince Alwaleed made almost 100% return from sale of stake in Dubai ride-hailing firm

Kingdom Holding to invest Careem proceeds in Saudi, Europe
Prince Bin Talal’s Kingdom was among the first investors in Uber's Middle East rival, Careem, which was acquired by its US competitor for $3.1bn this week, ahead of Uber's initial public offering.

Prince Alwaleed bin Talal’s Kingdom Holding will use the proceeds from its stake sale in Dubai ride-hailing firm Careem towards $600m in investments in Saudi Arabia and Europe, its CEO told Reuters.

The Saudi investment giant sold its stake in Careem this week for $333m, for which it will receive over $150m in cash and $182m in convertible bonds in Uber Technologies.

It is currently considering five companies in Saudi and Europe for investment, and expects to make a decision within the next eight weeks, chief executive Talal Ibrahim al-Maiman said.

He added that Kingdom Holding will not deploy all its cash in one go, but will opt for a combination of debt and equity.

Seventy percent of its investments will be directed into income-generating, dividend-distributing investments, while 30 percent will be dedicated to technology and potential growth companies, al-Maiman said.

Prince Bin Talal’s Kingdom was among the first investors in Uber's Middle East rival, Careem, which was acquired by its US competitor for $3.1bn this week, ahead of Uber's initial public offering.

Kingdom also has a 2.98% stake in Uber’s other rival Lyft, which was valued at $24.3bn in the ride-hailing sector’s first IPO last week, with its shares opening up more than 20 percent a day after it went public.

In the event of an exit, Kingdom will make an internal rate of return (IRR) of 53% on Lyft, al-Maiman said, adding that it has made almost 100% on Careem.

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