The telecom company “STC” in the Kingdom of Saudi Arabia said that it received a letter from the Saudi Sovereign Fund, which is under the supervision and management of the Saudi Crown Prince, and which manages MBS projects launched in Vision 2030, stating that the telecommunications company should study the possibility of selling part of the shares of the Fund, which is the largest investor in the company while maintaining the percentage of control to 50% in order for the state to control the company. This comes as a new attempt at the privatization of major national projects and companies, such as the Saudi oil giant Aramco.
In response to the Sovereign Fund’s request; The Saudi Telecom Company said that the process of selling any shares of the sovereign fund has not started yet, and the latest developments will be announced after obtaining the relevant approvals, in accordance with the sovereign fund’s announcement of the potential deal.
It is worth noting that the Saudi Sovereign Fund or the Public Investment Fund is the largest shareholder in “STC”, as the fund owns 70% of the company's shares, which has a market value of 254 billion riyals ($67.7 billion). The value of the fund's stake in it is $47.4 billion.
In a statement, the Saudi Sovereign Fund expected that the potential deal would contribute to supporting the strategy of developing new sectors, promoting the growth of the Saudi economy, and diversifying its sources of income.
The fund's statement said, “The potential deal contributes to achieving greater value for the company's shareholders in the medium and long term, by diversifying the company's investor base, increasing the number of free shares in the market, and weighing the company in relevant global indicators.”
The statement added, “The final decision regarding the potential deal will take into account the market conditions at the time and the interests of the company's existing shareholders.”
As for the companies that will implement the deal, the fund said that it has appointed “Goldman Sachs Saudi Arabia”, “HSBC Arabia”, “Morgan Stanley Saudi Arabia” and “Al-Ahly Capital” to study the options for executing the deal.
Economic analysts believe that bin Salman’s privatisation of public companies is only in the interest of a group of senior businessmen around him who are affiliated with his regime, and such deals will only cause great losses to the local economy as his decisions are ill-considered.
