The sale of middle-eastern ride-hailing company Careem for $3.1 billion to Uber has proven to be one of the biggest acquisitions this year, and considering the fact that the American ride-hailing company is going to go public this year, it was perhaps a strategic move. With the middle-eastern market now in its pocket, Uber can command even higher valuations, when it is eventually listed on the stock markets. The sale has resulted in a windfall for many of the investors in Careem, and one of the bigger winners was Kingdom Holdings, the investment firm based in Saudi Arabia, which walked away with $333 million from the deal. The proceeds were broken down into cash and convertible bonds from Uber.
However, the investment firm is now gearing up for its next round of investments, and it has decided to spend all the cash they got from the deal in their investments in Europe and Saudi Arabia. According to reports, the total investments are going to be to the tune of $600 million. The investment firm is owned by Prince Alwaleed bin Talal, who holds a stake of 95% and the next round of investments from the firm is going to have a big say on its immediate future.
According to one of the executives of the firm, Talal Ibrahim al-Maiman, Kingdom has zeroed in on five companies, but it will take some time before they decide on where to put their money. He said,
We have five companies on the table that are being discussed, deliberated. Hopefully, we will be able to come to a conclusion on where to invest within the next eight weeks.
He also confirmed that the investments will be a total of around $600 million, but at the same time, he was quick to add that the capital will not be allocated at one go but instead will be invested in stages.
According to reports, the firm is going to allocate around 70% of its capital into long term investments, that will generate dividends, and the rest will be towards tech companies which have the potential of generating a significant return on capital. Kingdom was one of Careem’s earliest backers, and the company has also taken up a stake in Lyft, which had its IPO yesterday. Kingdom has a holding of 2.98% in Lyft and informed that the company doubled its money on the Careem deal.