Saudi Oger in talks to sell its 21 percent stake in Arab Bank
Experts raise doubts to what extent the upcoming share sale Jordan-based bank will help solve debt crisis
Dubai - Saudi Oger has begun talks to sell its 21 percent stake in Arab Bank, which could raise an estimated $1 billion.
The sale comes following the difficult financial circumstances faced by the company, which had to restructure billions of dollars’ worth of debt, according to Al Arabiya.Net. Economic experts raise doubts to what extent the upcoming sale of the company’s shares in the Arab Bank will help solve the debt crisis.
Jordan-based Arab Bank operates across the Middle East and has a total of 600 branches on five continents.
Saudi Oger was founded in 1978 and operates in construction, engineering, facility management, real estate development and communication through the mother company and its subsidiaries.
Among the subsidiaries and affiliate companies where Saudi Oger has invested are Sheraton Riyadh Hotel and Towers, where it owns the entire stake, 40 percent of Tihama Power Generation Company Limited, and 8.6 percent in Saudi Investment Bank.
The Company has also invested in the Arab Bank via a subsidiary, owning 21 percent of the bank.
Saudi Oger bought 55 percent of Turk Telekom in 2005 through Oger Emirates Telecom for $6.6 billion.
Oger Telecom Emirates is owned by three different parties - 47.3 percent by Saudi Oger, 35 percent by Saudi Telecom, while the remaining shares are held by a Turkish investor.
Saudi Oger controls many entities like the King Abdullah University of Science and Technology and a number of hotels such as the Ritz Carlton Riyadh, Le Meridien Towers in Makkah, as well as the airports of King Khaled International airport in Riyadh, and Prince Mohammad Bin Abdulaziz International Airport in Madinah.
Oger has an important status in the Middle East, Asia and Europe, since it has subsidiary companies all over Saudi Arabia, UAE, Lebanon, Morocco , Jordan, Turkey, Britain, France, China, India, Italy, and the Philippines.
The falling of oil prices had a major adverse impact on Saudi Oger, which relies heavily on governmental projects. The company is worth $4 billion (15 billion rials), while the money the company owns to the contractors and workers is around $666 million (2.5 billion rials).
*This report was first published in AlArabiya.net on October 18, 2016.