Privately-owned carrier SaudiGulf Airlines will start international operations in March, nearly 18 months since it began domestic operations.
The carrier, backed by the Abdulhadi al-Qahtani & Sons Holding Company, will begin two daily flights between Riyadh and Dubai and an undisclosed number of flights between Dammam and four destinations in Pakistan, namely Lahore, Islamabad, Peshawar and Sailikot.
MEED understands the airline has been operating an estimated 200 weekly flights between Riyadh, Dammam, Jeddah and Abha since it began operations in late 2016.
SaudiGulf is one of three new airlines that began operating in Saudi Arabia since the second half of 2016. The other two are Nesma Airlines, also privately owned, and Flyadeal, the low-cost carrier arm of flagship carrier Saudi Arabian Airlines (Saudia).
The launch of two new privately owned airlines, in addition to Kingdom Holding-backed Flynas, is part of the kingdom’s initiative to introduce competition in its aviation sector, which has been dominated by Saudia over the past decades.
Flynas achieved profitability in 2015, following seven years of loss-making operations.
MEED earlier reported that Saudia and Flyadeal are to be privatised most likely through an initial public offering (IPO) by 2020.
The rest of the Saudia business, which has not been privatised, will be included in the 2020 plan. This includes the cargo, maintenance, training, medical and real estate units of the state-backed carrier.
It is understood a new limited liability holding company, Saudi Arabian Airlines Corporation (SAAC), is being formed as part of the privatisation programme. All the Saudia business units to be privatised will be organised under SAAC as the parent company.
Shares of Saudia’s catering and ground-handling services units were earlier listed on the Saudi Stock Exchange (Tadawul). In 2012, Saudia listed 30 per cent shares in its catering unit and raised $347m. The ground services unit offered 30 per cent of its shares in 2015 and raised an estimated $750m in capital.
Saudia operates a fleet of 141 aircraft while Flyadeal began commercial operations only in September last year.
Privatising the state-backed carriers, along with the airports, are part of the kingdom’s $200bn sell-off that comes under its National Transformation Programme.
|This article has been unlocked to allow non-subscribers to sample MEED’s content for FREE. MEED provides exclusive news, data and analysis about the Middle East every day. Subscribe to MEED to have full access to Middle East business intelligence. Click here|