As per the PIF announcement, Saudi Arabia's Public Investment Fund (PIF) entered a share purchase agreement with the Saudi Basic Industries Corporation (SABIC) to buy a 100 percent stake in the Saudi Iron & Steel Company (Hadeed). According to the release, Hadeed will also acquire a 100 percent interest in the AlRajhi Steel Industries Company (Rajhi Steel) from Mohammed Abdulaziz AlRajhi & Sons Investment Company (Rajhi Invest) in return for newly issued Hadeed shares.
The deals will be completed subject to the customary approvals from the competent authorities and the satisfaction of certain conditions in the transaction agreements. The shareholdings of PIF and Rajhi Invest in Hadeed will be finalized subject to the closing mechanisms outlined in the agreements.
According to the statement, the transactions are in line with PIF's larger aims to promote Saudi Arabia's industrial growth and will help fulfill rising local steel demand while also strengthening Saudi Arabia's steel production capacity. Furthermore, in accordance with Saudi Vision 2030, the transaction will assist in the expansion of important downstream sectors such as local construction, automotive, utilities, renewables, transportation, and logistics.
Based on SABIC, the PIF's acquisition of 100% of Hadeed represents an implicit enterprise value of about SAR12.50 billion.