Saudi Arabia aims to raise $200 billion through privatization in 16 sectors

Saudi Arabia aims to raise around $200 billion in the next several years through privatization programs in 16 sectors ranging from oil to healthcare, education, airports, utilities, and grain milling.

Following is a list of major privatization plans currently underway, according to Reuters. This plan dovetails Kingdom’s Vision 2030 and the National Transformation Program 2020 for enhancing non-oil economy through Public-Private partnerships.

SAUDI ARAMCO. The government has said it plans to sell close to 5 percent of the national oil giant next year through an initial public offer, with the shares to be listed in Riyadh and at least one foreign exchange. Officials have said the sale will value Aramco at $2 trillion or more, though some private analysts have suggested a lower range, perhaps $1-1.5 trillion.

SAUDI POSTAL CORP. In February, Riyadh invited banks to pitch for an advisory role in the sale of the government-owned postal service, sources said.

SAUDI GRAINS ORGANIZATION. State-owned Saudi Grains Organization, which handles the kingdom’s grains purchases, is preparing to sell off its milling operations by placing them in four specially formed corporate entities while retaining other functions. A partnership of U.S. agribusiness giant Archer Daniels Midland Co and Saudi foods group Almarai is among potential bidders, sources said in March.

SOCCER CLUBS. Saudi Arabian investment bank Jadwa Investment was appointed to advise on the privatization of as many as five soccer clubs in the Saudi Professional League, sources told Reuters in February.

SAUDI ARABIAN AIRLINES. State-owned Saudi Arabian Airlines has started the sale of its medical services business in Jeddah, valued at around $500 million, sources said this month.

HEALTHCARE. Among the first assets to be privatized will be one of Saudi Arabia’s top hospitals, King Faisal Specialist Hospital and Research Center in Riyadh, an official said. The process is in a “very advanced stage”, Vice Minister for Economy and Planning Mohammed al-Tuwaijri told Reuters last month.

Also, the Ministry of Health has received at least six bids to act as financial adviser for the privatization of 55 primary healthcare centers in Riyadh, sources said.

EDUCATION. Saudi Arabia hired HSBC as financial adviser to privatize construction and management of school buildings, the chief executive of Tatweer Buildings Co, a state firm affiliated with the Ministry of Education, said in January.

SAUDI ELECTRICITY CO. Riyadh plans to split state-controlled utility Saudi Electricity Co into separate companies that would be offered either to local citizens through IPOs or to local or international corporate partners. Riyadh-based ACWA Power chief executive Paddy Padmanathan told Reuters in March he expects the first of four power generation companies owned by Saudi Electricity will be offered by year-end.

SALINE WATER CONVERSION CORP. Officials last year outlined plans to privatize Saline Water Conversion Corp, which desalinates water and produces electricity. It would be transformed into a joint-stock holding company served by local production units; investment partners for the units would then be sought, followed by an IPO for the holding company.

SADARA CHEMICAL. Saudi Aramco plans to cut its stake in Sadara Chemical Co , a joint venture with Dow Chemical, to 35 percent from 65 percent via an IPO, Sadara chief executive Ziad al-Labban said this month, without giving a timeline.

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