Saudi Arabia’s Public Investment Fund (PIF) is reportedly in early discussions to acquire Saudia, the kingdom’s flagship airline, as part of a broader strategy to elevate Saudi Arabia into a global tourism hub.
This potential acquisition seeks to optimize Saudia’s operations and profitability, with potential considerations for privatization or integration with Riyadh Air, a newly established airline.
Should the acquisition proceed, it would represent a significant addition to PIF’s expanding aviation portfolio, reflecting Saudi Arabia’s ambitious goal to rival major Gulf carriers and attract 150 million tourists annually by 2030.
The precise valuation of Saudia in this potential deal remains undisclosed. However, Saudia operates a fleet of over 142 aircraft, serving over 90 destinations worldwide. Discussions surrounding the acquisition are still in preliminary stages, and definitive decisions are pending.
The envisioned acquisition could see Saudia pivoting towards a focus on religious pilgrimages, aligning with Saudi Arabia’s broader economic diversification and tourism sector enhancement objectives.
Notably, Saudia and Riyadh Air collaborated last year on a substantial order of 78 Boeing Co. 787 Dreamliners, valued at nearly $37 billion, as recognized by the White House, emphasizing significant investment commitments in the aviation sector.
The PIF plays a pivotal role in Saudi Arabia’s vision to cultivate a thriving tourism and aviation industry. Extensive investments are planned to revamp Riyadh’s airport into a leading global aviation hub and to establish new aviation-related enterprises.
These initiatives encompass the establishment of an aircraft leasing company, a helicopter enterprise, and investments in Saudia’s engineering subsidiary. These strategic endeavors are in line with Saudi Arabia’s Vision 2030, which aims to diversify the economy away from oil dependency and introduce various sources of foreign currency.
