Saudi PIF plans $1bn stake in Almosafer

Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, has signed a non-binding agreement with Seera Group Holding to acquire a SR3.75 billion ($1 billion) stake in its Almosafer travel unit.

The PIF seeks to own 30% of Almosafer’s capital, Seera Group said in a stock exchange filing. As part of the deal, Seera’s destination management subsidiary Discover Saudi and its Hajj and Umrah operator Mawasim will come under the Almosafer umbrella.

This means that Almosafer will cover four areas of travel: consumer retail, corporate/business travel, religious travel and destination management.

The proposed transaction is a strategic milestone in Seera’s pioneering transformation plan announced in 2017, to strengthen the group’s businesses and enhance long-term value for shareholders, the group said.

Almosafer aims to use the capital injection to expand its tourism operations and strengthen its position as the leading travel agency in the Kingdom.

Seera Group reported a strong second quarter of 2022 as it saw an uptick in all sectors: domestic, inbound and outbound. Its gross book value (GBV) increased to SAR 2.5 billion (US$923 million) in the second quarter (April to June) of 2022, an increase of 108% compared to SAR 1.2 billion in the second quarter of 2022. 2021.

For the first six months of 2022, Seera achieved GBV of SAR 4.1 billion ($1.1 billion), an increase of 105% compared to SAR 2 billion in the same period in 2021.

Almosafer, its travel business, recorded an 89% growth in GBV to SAR 1.7 billion in Q2 2022, up from SAR 900 million in Q2 2022. 175% compared to SAR 400 million of SAR in the second quarter of 2021.

In June 2022, Almosafer recorded the highest levels of consumer travel bookings in its history, surpassing pre-pandemic levels in June 2019 by 27% with a GBV of more than SAR 500 million. Almosafer’s consumer travel segment is on track to reach SAR 4 billion GBV by the end of 2022.

Chaired by Crown Prince Mohammed bin Salman, the $620 billion PIF is dipping deeper into public markets as it pursues a goal of growing its assets to about $1 trillion by 2025.

* This article originally appeared on WebInTravel

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