Saudi Airlines Cargo Company, the cargo subsidiary of Saudi Arabian Airlines (Saudia) has appointed the local Samba Capital & Investment Management Company as financial adviser and lead manager for its initial public offering (IPO). The subsidiary plans to list shares on the Saudi Stock Exchange (Tadawul).

Saudia is also planning to launch an IPO for its maintenance unit in 2015, according to news agencies. That would be the third of six units Saudia had decided to privatise in 2006.

“Saudi Airlines Cargo Company’s intention to list its shares on the Tadawul is consistent with the privatisation strategy adopted by the government of Saudi Arabia to restructure Saudia’s subsidiaries. This will enable Saudi Cargo to further grow its business and strengthen its competitive position at both the regional and international level,” said Khalid bin Abdullah Al-Molhem, chairman of the cargo firm after signing the agreement.

The IPO plans are part of Riyadh’s aim to turn flag carrier Saudia into a brand able to compete with regional rivals such as Qatar Airways and the UAE’s Emirates airline and Etihad Airways.

Billions of dollars are being invested in the kingdom’s main airports to improve the travel experience for the millions of pilgrims and tourists who enter the country each year. King Abdulaziz International airport in Jeddah is being expanded to increase the airport’s annual passenger capacity from 13 million to 30 million.