Saudi Arabia’s sovereign wealth fund now controls one of the Middle East’s largest media companies, paying what appears to be a 30% premium to buy the stake from the kingdom’s finance ministry. Public Investment Fund completed the $2 billion deal last week. When it first proposed acquiring the stake in MBC Group at that price last November, it had expected a discount — but the company’s shares have since slumped.
The holding was sitting in a Finance Ministry unit created to manage assets seized from billionaires during the 2017 Ritz Carlton corruption purge. Billionaire Waleed Al Ibrahim, who founded the satellite TV network that once had around 140 million daily viewers, was detained for 83 days that year.
PIF says the purchase is meant to accelerate growth in Saudi Arabia’s media industry, though MBC won’t get new capital and was already shifting operations to the kingdom. Investors welcomed the transfer, seeing PIF, which is executing Crown Prince Mohammed Bin Salman’s economic transformation, as a backer that would protect MBC from regulatory risk: The company’s shares spiked to a two-month high on the announcement.