Saudi sovereign wealth fund PIF (Public Investment Fund) has announced the signing of a share subscription agreement with leading oil and gas systems manufacturer Alkhorayef Petroleum.
The deal involves a capital increase and subscription to new shares amounting to a 25% shareholding in the company. Alkhorayef Group, the parent company and current shareholder of Alkhorayef Petroleum, will retain a 75% stake.
Alkhorayef Petroleum is the leading Saudi-based provider and manufacturer of oil and gas production optimization solutions, specializing in artificial lift, wireline services and equipment, as well as early production facilities.
The company is also the only Gulf-based manufacturer of electric submersible pumps; equipment critical to oil and gas production. It has achieved a diversified revenue base and a successful operational track record in 13 countries across the Gulf countries, as well as in Africa and Latin America.
This investment demonstrates PIF’s broader efforts to develop Saudi Arabia’s equipment and service landscape and support the growth of promising private sector companies to further develop the industrial ecosystem and increase export revenues.
PIF’s investment will enable Alkhorayef Petroleum, a private sector company, to be better positioned to realize its full potential by leveraging its extensive technical and commercial capabilities, said a top official.
It will also strengthen its position in the energy services industry and create long-term value for shareholders. The agreement will further improve supply chains in the energy services sector in Saudi Arabia, it added.
Muhammad Aldawood, Head of Industrials and Mining sector in Mena Investments at PIF, said: "This transaction forms part of PIF’s broader efforts to deepen the manufacturing sector in Saudi Arabia and represents a milestone in strengthening the regional industrial ecosystem."
"This investment is expected to enable Alkhorayef Petroleum’s growth strategy in local and international markets, and further expand its manufacturing output while also focusing on innovative R&D in high-growth areas," noted Aldawood.
"Our investment aligns with PIF’s domestic strategy to develop key sectors and work alongside strategic economic partners in the private sector to support the delivery of Vision 2030," he added.
On the big investment win, Saad Alkhorayef, Chairman of Alkhorayef Petroleum and Alkhorayef Group, said it is a recognition of the group's achievements in the Middle East as well as across Africa and Latin America, and the strategic role Alkhorayef Petroleum plays in supporting the oil and gas sector in Saudi Arabia and other regions.
"The investment with PIF is a major milestone in our journey and will allow the company to strengthen its position as a leading oilfield services company and preferred long-term partner to our customers worldwide," noted Alkhorayef.
"We firmly believe that the company can become one of the world’s leading oilfield services companies, and this investment further reinforces our ambition and determination," he added.-TradeArabia News Service