Saudi fund buys almost 17% stake in Kingdom Holding

Saudi Prince Alwaleed, a significant shareholder in Four Seasons Hotels and Resorts, as well as owner of iconic assets like the Four Seasons  Hotel George V in Paris, has signed an agreement with Saudi sovereign wealth fund The Public Investment Fund (PIF) to sell 16.87% of Kingdom Holding Co. for approximately US$1.51 billion.

PIF will reportedly buy 625 million shares at 9.09 riyals (US$2.42) a share for 5.68 billion riyals (US$1.51 billion). Prince Alwaleed will retain a majority 78.13% stake, while the remaining 5% of the stock will remain listed on the Saudi bourse.

The Four Seasons Hotel George V in Paris

The PIF, which manages over US$600 billion in assets, is part of Saudi Crown Prince Mohammed bin Salman’s ambitious agenda to diversify the economy away from oil.

Kingdom Holding invests across 18 sectors with assets exceeding US$13.3 billion. It holds notable stakes in companies like Citigroup and Apple. Last September, Kingdom Holding Co. sold half of his interest (23.75%) in Four Seasons Hotels and Resorts to an affiliate of Bill Gate’s Cascade Investment, its long-term investment partner in Four Seasons, taking Cascade’s stake from 47.5% to a controlling 71.25%.

Kingdom Hotel Investments CEO Sarmad Zok told HOTELS on Monday that he has resigned his board seat at Kingdom Holding Co. for “technical reasons” as PIF governance requires that immediately upon closing it takes a seat on the board. “However, nothing changes, and I continue to fulfill my role and my responsibilities as before in my capacity as CEO of Kingdom Hotel Investments overseeing KHC’s global hospitality investments,” Zok said.

The transaction took place on Saudi Arabia’s stock exchange on Sunday and by Monday KHC shares were trading up 9%.

In 2018, Prince Alwaleed was held for about three months at Riyadh’s Ritz-Carlton, along with other royals, senior officials and businessmen, as part of a state-led anti-corruption campaign.