Saudi Arabia’s Public Investment Fund (PIF) is reported to be behind the $5.1 bn investment of Signa Holdings in London’s Selfridges.
Last year, Australian real estate firm Signa Holdings and Thai retailer Central Group acquired a 50 percent stake in Selfridges Group.
Citing undisclosed sources, a UK-based media outlet said Saudi’s sovereign wealth fund made a ‘minor contribution’ to Signa Holdings. The joint venture beat a bid by Qatar’s sovereign wealth fund, which owns rival London department store Harrods.
A spokesperson for Signa Holdings confirmed Saudi Arabia’s interest in Selfridges. The source said, however, that “The ownership of Selfridges has not changed.”
Buyout’s significance
Selfridges employs about 10,000 people and owns 25 stores worldwide. Its retail network includes stories in major cities in the UK, Canada, Ireland and the Netherlands.
The upscale chain of department stores is best known for its flagship store on London’s Oxford Street. It was founded in 1908 by US retail magnate Harry Gordon Selfridge.
Significantly, the deal spares Selfridges Group’s seven Holt Renfrew department stores in Canada. It will remain the property of its owner, the Weston family. One of the wealthiest in the world, Canada’s Weston family bought Selfridges for nearly $771 mn in 2003.
Read: Saudi unveils sports investment project as PIF takes over leading football clubs
Saudi PIF’s investment initiatives
One of the 20 largest global economies and an active member of the G20, Saudi Arabia is continuing to diversify its economy away from oil.
Moreover, Saudi has invested on various companies across the world, particularly in the UK. Saudi nationals are known to frequent the UK as a travel and shopping destination. In addition, many Saudi citizens have pursued higher education degrees in UK colleges and universities.
Saudi PIF’s investment in Selfridges adds to its growing portfolio of high-profile investments in the UK. This includes majority ownership of Newcastle United and the second-largest stake in Aston Martin.
Locally, Saudi Arabia has spruced up its investments on different industries such as aviation, logistics, transportation, technology, among many others, pouring in billions in capital.
Saudi has also opened up its doors for more international tourism. In June, the PIF-funded Cruise Saudi announced the launch of AROYA Cruises, which is set to offer extraordinary passenger experiences and a one-of-a-kind opportunity for guests to explore the wonders of Saudi Arabia from the sea.
PIF said Cruise Saudi aims to welcome 1.3 million cruise visitors as well as creating 50,000 direct and indirect job opportunities by 2035. Saudi Arabia is targeting to attract as much as 100 million visitors per year by 2030.
For more economy related stories, click here.
