KHOBAR, Saudi Arabia (Reuters) - Saudi Arabia will consider selling a large stake in Saudi Electricity Co to SoftBank Vision Fund, but the Saudi government would retain a controlling shareholding, the utility said on Tuesday.
Saudi Arabia’s Public Investment Fund, which holds a 74 percent stake in Saudi Electricity Co (SEC), signed a memorandum of understanding with SoftBank Vision Fund, the world’s largest private equity fund, on Monday for SEC to develop 3 gigawatts of solar energy in 2018, SEC said in a statement.
No financial details of the agreement were made public.
The statement said “the parties” would also evaluate the possibility of SoftBank Vision Fund, which is backed by Japan’s SoftBank Group (9984.T) and Saudi Arabia’s main sovereign wealth fund, acquiring a big stake in Saudi Electricity Co.
The Saudi government would retain a controlling stake, it said.
SEC’s assets are estimated to be $100 billion. The Saudi government has been considering privatizing the company for years. It is not clear how the possible transaction will affect those plans.
Oil giant Saudi Aramco currently owns nearly 7 percent of Saudi Electricity Co while the rest is held by the public.
The Public Investment Fund and SoftBank Vision Fund will also build manufacturing and storage solar facilities and create jobs in the kingdom.
Due diligence will be completed by the end of February next year, the company said.
SoftBank Vision Fund has raised over $93 billion to invest in technology sectors such as artificial intelligence and robotics.
Reporting by Reem Shamseddine; Editing by Adrian Croft