The Saudi Arabia Public Investment Fund (PIF) is negotiating for a stake in flynas (XY, Riyadh), the Riyadh-based budget carrier that’s a key pillar of the kingdom’s attempts to bolster its tourism sector, Bloomberg reports.
According to "people familiar with the matter" who asked not to be named, leading global investment group Goldman Sachs is advising flynas shareholders on the potential stake sale to the Saudi sovereign wealth fund. The airline is partly owned by Prince Alwaleed Bin Talal’s Kingdom Holding Co., in which PIF bought a 17% stake last year.
flynas had also been planning a potential listing, the sources said, though this might be delayed if the stake sale to PIF goes ahead. The carrier has been weighing an IPO since 2008 and in 2018 hired Morgan Stanley, Citigroup Inc. and NCB Capital for a potential deal, Bloomberg News reported.
flynas, Goldman Sachs and PIF declined to comment to Bloomberg, while representatives for Kingdom Holding weren’t immediately available for comment. ch-aviation also has approached flynas for comment.
Saudi Arabia has been pumping money into its aviation industry to make the country a top tourism destination as well as intercontinental hub as it diversifies its economy away from fossil fuels, rivalling aviation hubs in the United Arab Emirates (UAE) and Qatar.
As part of these efforts, Flynas is establishing local subsidiaries in two more countries and expanding its existing aircraft orders with the aim of becoming the Middle East’s biggest low-cost airline and one of the five largest globally.
Saudi Arabia is also setting up another national airline, Riyadh Air (RXI, Riyadh), and building a new airport in the capital, both of which will be owned by PIF which is chaired by Saudi Crown Prince Mohammed bin Salman.
