Neom plans IPO and $80bn fund

27 July 2022
Neom Investment Fund will invest in companies that agree to operate at the development

Saudi Arabia plans to set aside SR300bn ($80bn) for an investment fund tied to the $500bn Neom megaproject and undertake an initial public offering of the project on the kingdom’s stock market by 2024.

According to Saudi Arabia’s Crown Prince Mohammed bin Salman, the planned Neom Investment Fund could potentially expand to SR400bn.

The fund will invest in companies that agree to operate at Neom.

The crown prince also disclosed the multi-stage funding planned for the megaproject. Its first phase, which runs until 2030, will cost SR1.2tn, with the Public Investment Fund covering roughly half of the required financing.

Officials will raise the remaining half from other sovereign wealth funds in the region, private investors in Saudi Arabia and abroad, and an IPO of Neom itself on the local stock market.

Project spending is ramping up at Neom. According to regional projects tracker MEED Projects, Neom was the third-most active project owner in the region for contract awards during the first half of this year. It awarded $4.8bn of contracts, the bulk of which comprised the four tunnelling packages awarded for The Line.

Neom recently invited consultants to express interest in providing project management services for hotels planned for the Gulf of Aqaba, a 120-kilometre-long coastal strip at Neom with an average width of 3.5km. 

READ: Executive lays down Neom energy plan

Neom is expected to obtain 100 per cent of its energy from renewable sources by 2030.

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