Kingdom Holding to invest Careem proceeds in Saudi, Europe

Saudi investment firm owned by Prince Alwaleed made almost 100% return from sale of stake in Dubai ride-hailing firm.

Prince Alwaleed bin Talal’s Kingdom Holding will use the proceeds from its stake sale in Dubai ride-hailing firm Careem towards $600m in investments in Saudi Arabia and Europe, its CEO told Reuters.

The Saudi investment giant sold its stake in Careem this week for $333m, for which it will receive over $150m in cash and $182m in convertible bonds in Uber Technologies.

It is currently considering five companies in Saudi and Europe for investment, and expects to make a decision within the next eight weeks, chief executive Talal Ibrahim al-Maiman said.

He added that Kingdom Holding will not deploy all its cash in one go, but will opt for a combination of debt and equity.

Seventy percent of its investments will be directed into income-generating, dividend-distributing investments, while 30 percent will be dedicated to technology and potential growth companies, al-Maiman said.

Prince Bin Talal’s Kingdom was among the first investors in Uber's Middle East rival, Careem, which was acquired by its US competitor for $3.1bn this week, ahead of Uber's initial public offering.

Kingdom also has a 2.98% stake in Uber’s other rival Lyft, which was valued at $24.3bn in the ride-hailing sector’s first IPO last week, with its shares opening up more than 20 percent a day after it went public.

In the event of an exit, Kingdom will make an internal rate of return (IRR) of 53% on Lyft, al-Maiman said, adding that it has made almost 100% on Careem.