Kingdom Holding, Saudi Prince Alwaleed bin Talal’s investment company, is seeking a loan to help pay for the construction of the world’s tallest tower, two people with knowledge of the matter said.
The company initiated talks with Saudi lenders and has not hired bankers to advise on the financing, said the people, who declined to be identified because the plans are not public.
Kingdom Holding, 95 percent owned by Prince Alwaleed, is seeking to borrow as much as SAR2bn (US$533m) by the second half of the year, one of the people said.
Kingdom Holding has said it will use bank financing, cash and revenue from the project to build the skyscraper in Jeddah, which will surpass the Burj Khalifa in Dubai as the world’s tallest tower.
Kingdom Tower, with a height of more than 1,000m (3,281 feet), is expected to cost US$1.2bn to build.
Construction is expected to be concluded in about five-and-a-half years.
A spokeswoman for Riyadh, Saudi Arabia-based Kingdom Holding did not respond to calls or an e-mail seeking comment.
The company’s shareholders last month approved a plan to sell as much as SAR3.75bn of bonds in Saudi Arabia or outside the country.
Saudi Binladen Group, hired to build the tower, has invested SAR1.5bn for a 16.6 percent stake in Jeddah Economic Company, the project’s owner.
The building received final municipal approvals in February.
The tower will include a Four Seasons hotel, apartments, offices, three lobbies on the upper floors and the world’s highest observation deck on the 157th level.
The building was designed by Adrian Smith, the Chicago architect responsible for the 828m Burj Khalifa, which opened in 2010.
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