Saudi wealth fund PIF denies plans to sell its stakes in local firms

Saudi Arabia’s sovereign wealth fund – the Public Investment Fund (PIF) – has “vehemently denied” having any plans or intentions to sell the shares it owns in local companies, it said in a brief statement on Wednesday.

The fund’s denial came after a report by Bloomberg claimed that the PIF is reviewing the sale of stakes in local companies as it seeks to diversify its portfolio.

Sources told Bloomberg that the PIF – which is estimated to have about $100bn worth of shares in local listed companies, is considering sale options.

Saudi is currently in the midst of a major plan to expand the PIF into a major global fund, raising its capital to SAR7 trillion ($2 trillion) from SAR600bn ($160bn).

This will be accomplished by transferring the ownership of state-owned oil giant Saudi Aramco to the PIF, according to deputy crown Prince Mohammed bin Salman.

The restructuring of PIF is part of the country’s ambitious Vision 2030 strategy, which seeks to diversify its economy away from oil.

Revealing details about the plan earlier this year, Prince Mohammed said the PIF would become a hub for Saudi investment abroad, partly by raising money through selling shares in Aramco.

“We are speaking about more than $2 trillion. We expect the valuation to be more than $2 trillion. In addition to that there are other assets that will be added to the fund, and part of it is already added,” he said.

Also read: In depth: Saudi prince unveils plans to end “addiction” to oil

Earlier this week, the Saudi wealth fund teamed up with Dubai businessman Mohamed Alabbar to launch a massive e-commerce platform in the Middle East.

Called Noon.com, the site is being launched with an initial investment of $1bn with the PIF and Alabbar and other Gulf investors contributing $500m respectively. Both sides will take a 50 per cent stake.

The operation will be headquartered in Riyadh and the platform will launch in Saudi Arabia and the UAE in January with 20 million products.

Read more: Dubai’s Alabbar to “dominate” Middle East e-commerce with Saudi-backed platform

The fund is also considering buying a stake in Riyadh-based ACWA Power, which operates power and water plants around the world, sources told Reuters on Monday.