RIYADH (Reuters) - Saudi Arabian Airlines SAUD.UL signed a deal on Sunday with an affiliate of French investment bank Calyon (CAGR.PA) to advise on an initial public offering of its catering company, state news agency SPA said.
The airline, one of the Middle East’s largest carriers, launched a gradual privatisation of its catering, cargo, maintenance, ground services and aviation services units to pave the way for a flotation of a stake in its core transport unit.
The airline also signed an agreement with U.S. bank Morgan Stanley (MS.N) and an investment unit of state-run National Commercial Bank to advise on plans to privatize its core unit, the agency said, without giving details.
The report on the agreement with Calyon Saudi Fransi, part of the Banque Saudi Fransi (1050.SE) group, did not specify a date for the IPO.
In October, an airline official indicated that the IPO offering 30 percent of the catering unit would be held around the third quarter of 2010.
In July, a committee of Saudi Arabia’s advisory Shura Council recommended an IPO for the airline, instead of selling off its units piecemeal in a privatisation effort.
The airline has already sold to private investors a 49 percent stake in the catering unit and 30 percent of its cargo unit.
The airline also signed an agreement on Sunday to merge its ground services company with two Saudi counterparts, the agency said. It did not give financial details of the merger.
Reporting by Souhail Karam; writing by Firouz Sedarat, editing by Matthew Lewis and Diane Craft