The local Consulting Centre for Finance & Investment will be the lead placement agent and Al-Khabeer Financial Advisors will consult on the debt structuring. Savola will retain a 30 per cent stake in the new company, with the remainder split between a maximum of seven strategic partners, whose minimum investment will be SR 100 million ($27 million).

The new company will develop malls and mixed-use developments in the kingdom in line with Savola’s existing real estate assets, which include two hypermarkets and a further two due to open in early 2006, eight-10 long-term land leases and prime land plots.

‘We came to the decision that Savola should not limit its vision only to shopping malls but go into real estate development,’ says Abdulmalik Fathaddin, president of Savola’s real estate division, which was established in 2002. The company plans to build 14-18 more malls by 2010 and Fathaddin says the company could issue a public offering of shares in the future.

United Properties Development Company, a 70:30 joint venture of Savola and South Africa’s Old Mutual, will oversee the design, construction, lease and marketing of future real estate projects.