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Saudi Arabia-based investment firm Kingdom Holding Co. (KHC) has entered into a binding agreement with Red Sea Global Company to set up a joint venture (JV) that will develop a 2 billion riyals ($533.3 million) tourist resort.
The project shall include establishing a JV, 50% of which shall be owned by a special purpose vehicle (SPV) – currently under establishment – wholly-owned by KHC, and the remaining 50% shall be owned by a SPV owned by Red Sea Global Company, Kingdom said in a regulatory disclosure on Riyadh's Tadawul bourse on Tuesday.
The project will be allocated an approximate budget of SAR 2 billion, and each of KHC and Red Sea Global Company will invest SAR 258 million, respectively, as funding commitments via the SPVs established by each party. The remaining capital commitment will be financed by debt provided to the JV.
The project, to be located on Shura Island on the west coast of Saudi Arabia, will be operated by Four Seasons Hotels and Resorts Group which is partly owned by KHC.
Saudi billionaire Prince Alwaleed Bin Talal has a 78.13% stake in Kingdom Holding while The Public Investment Fund (PIF) holds a 16.87% stake.
(Writing by Brinda Darasha; editing by Daniel Luiz)
