Sovereign fund PIF considers Saudi Telecom stake sale, sources say

Saudi Arabia’s Public Investment Fund (PIF) is considering divesting part of its stake in Saudi Telecom, sources close to the matter told Reuters, as the sovereign wealth fund seeks to monetise some of its assets.

The fund, which holds $430 billion of assets, has hired Goldman Sachs and Saudi National Bank’s (SNB) investment banking arm to arrange a transaction, three sources said, declining to be named because the matter was not public.
PIF plans to double its assets to 4 trillion riyals ($1.07 trillion) by 2025, Saudi Arabia’s Crown Prince Mohammed Bin Salman said in January, crystalising gains on mature assets to make new investments.

One of the sources said the amount being considered for the Saudi Telecom deal is significant but was unable to disclose the value or size of the potential stake sale.

The PIF and Goldman Sachs declined to comment while Saudi Telecom and SNB did not immediately respond to requests for comment.

The fund currently owns about 70% of Saudi Telecom, worth about $50 billion, Refinitiv data and Reuters calculations show.

Saudi Telecom’s shares have risen by more than 25% this year and closed at 132.80 riyals ($35.73) on Tuesday.

PIF’s strategy is to build an international portfolio of investments while also investing locally in projects that will help to reduce Saudi Arabia’s reliance on oil.

The crown prince said in April that the fund would not hold assets indefinitely and would offload shares while retaining control in some companies over the coming years.

The PIF is taking the country’s Tadawul stock exchange public later this year and it has also hired advisers for the initial public offering (IPO) of digital security company Elm.

Saudi Telecom, meanwhile, is working on the IPO of its product and services development arm, Solutions by STC, and has hired advisers for the offering, sources told Reuters in October. Reuters