Saudi Sovereign Fund Raises $1 Billion from STC Stake Sale
Saudi Arabia's Public Investment Fund (PIF) announced on November 14, 2024, that it successfully raised approximately 3.86 billion riyals ($1.03 billion) through the sale of a 2% stake in Saudi Telecom Co (STC). This strategic move is part of the kingdom's broader economic diversification efforts under the Vision 2030 initiative, which aims to reduce the country's reliance on oil.
The shares were sold at a price of 38.6 riyals ($10.27) each, reflecting a 6.1% discount compared to STC's closing price of 41.1 riyals ($10.94) the previous day. Despite the discount, investor demand exceeded the offering size, indicating strong market interest. Following this transaction, the PIF will maintain a 62% ownership stake in STC, the largest telecommunications company in Saudi Arabia. The fund had previously sold 6% of STC for $3.2 billion in 2021, showcasing its ongoing strategy to recycle capital and invest in emerging sectors within the local economy.
The PIF, which manages around $1 trillion in assets, plays a pivotal role in the Vision 2030 program, which seeks to foster economic growth by developing new sectors and creating sustainable income sources. As of the latest update, STC shares experienced a slight decline of about 0.73% to 40.8 riyals ($10.86), although they have appreciated over 4% since the beginning of the year.
