Saudi-Pakistan private equity fund launched to lift investment

A Saudi-Pakistan private equity fund will put 75 percent of its money into Pakistan, under an MoU signed by investors from both countries.

The Saudi-Pakistan Joint Business Council signed the agreement. Both governments formed the council, in coordination with their high committee, to deepen private-sector trade and investment.

How the Saudi-Pakistan private equity fund will work

The Saudi-Pakistan private equity fund starts with equal contributions. Private investors from each country will put in the same amounts. Of its assets, 75 percent will go to Pakistani projects and 25 percent to Saudi ones.

The initial size will run to several hundred million, council members said. They expect it to grow as opportunities appear across sectors.

The MoU follows a series of council meetings. Institutions on either side may also be invited to take a stake in the company that manages the fund. In addition, council members proposed the initial size and see it growing into a larger vehicle.

Where the Saudi-Pakistan private equity fund will invest

The fund plans to back fast-growing private businesses, including agriculture, mining and construction. It will also study commercial projects that come out of Pakistan’s plan to earn money from its land bank.

Those projects include airports, motorways and port and maritime development. The aim is to release the value of unused public land through transparent, commercially structured deals.

On the Saudi side, the fund will pursue commercial deals across the kingdom, the holy cities included. Investors in both countries will therefore share in the returns.

Who attended the signing

Council co-chair Fawad Mukhtar, who chairs the Fatima Group, joined from Pakistan by video. Zafar Masud of the Bank of Punjab, Nassir Saleem of Habib Bank and Yousaf Hussain of Faysal Bank were there in person.

Maqsood Ismail of Ismail Industries also attended in person. Gohar Ejaz of the Lake City Group, Zameer Choudrey of the Bestway Group and Jawaid Iqbal of United Bank joined by video.

On the Saudi side, Prince Mansour bin Mohammad Al Saud, who chairs the council, led the signing. Its vice chairmen, including Mohammad Al Ajlan of the Al Ajlan Group, and members from the Tayba, RAEM, Alsharif and ASYAD groups took part.

What the chair said

Prince Mansour said the ties between the two countries run deeper than any agreement. “Friendship and kinship that run deeper than any agreement” had long been strong in spirit, he said, and the fund now gives them a commercial footing.

He called Pakistan a natural partner for the kingdom. Saudi investors, he said, are looking for partners and markets where they can grow with confidence. After looking closely, they see a more stable economy with real opportunities.

By investing side by side with Pakistani partners in both countries, he said, years of contemplation and study now turn into action on the ground.

For now, the Saudi-Pakistan private equity fund gives both countries a private-sector vehicle for deals that reach beyond government agreements. Also, the Saudi-Pakistan private equity fund adds a commercial layer to a partnership that has so far leaned on defence and diplomacy.