MEED revealed in February that a consortium led by the local Al-Muhaidib & Sons had won the contract (MEED 27:2:08).
It is being partnered by another local firm, Acwa Power, in a group called the Tarabot Air Freight Services Company
There has been no comment from the national carrier as to why it has taken so long to finalise the deal.
Tarabot will work as a strategic partner with Saudia to improve the management and operations of the cargo division, which will now be separated from the airline and run as an individual business unit.
Khalid Almolhem, director general at Saudia, says that the company’s freight revenues rose above SR1.7bn ($450m) in 2007 and exceeded SR1bn in the first half of 2008.
The airline’s technical services division is scheduled to be next for part-privatisation.