https://arab.news/c4gep
RIYADH: Affirming Saudi Arabia’s drive to attract foreign investments, Gas Arabian Services Co., a firm listed on the Kingdom’s parallel stock market Nomu, has sealed a partnership with India’s Tubefit Engineers.
This alliance aims to establish Tubefit Arabia Factory LLC, a limited liability company that manufactures various instrumentation fittings and valves.
According to an official filing on the Saudi stock exchange, the new venture will have its headquarters in Saudi Arabia.
The statement further revealed that Tubefit Engineers will hold a majority stake of 53 percent, while Gas Arabian Services Co. will possess the remaining 47 percent ownership.
The joint venture’s capital will be set at SR5 million ($1.33 million), with Gas Arabian Services Co. financing its part, valued at SR2.35 million, from its resources.
The prospective impact of this collaboration is expected to be positive for Gas Arabian Services Co. in the long run, the statement said, adding that establishing Tubefit Arabia Factory LLC remains contingent on regulatory approvals and the satisfactory fulfillment of agreement conditions.
The strategic move comes on the heels of Gas Arabian Services Co.’s robust financial performance in the first half of 2023. The company reported a net profit of SR35.5 million, marking a 99 percent increase from the same period last year.
The revenue surge was attributed to heightened sales and greater profit share from associates, the company said in a Tadawul statement.
The surge in foreign direct investments in Saudi Arabia, driven by regulatory reforms and the Vision 2030 initiative, was evident in the first quarter of 2023, as FDI inflows reached SR8.1 billion. This inflow reflected a substantial increase of 10.2 percent from the same period in the prior year.
In 2021, Saudi Arabia’s Ministry of Investments and the Royal Commission for Riyadh City introduced the Regional Headquarters Program to encourage global corporations to establish their headquarters within the Kingdom.
Further enhancing this approach, Investment Minister Khalid Al-Falih in March revealed that multinational firms relocating their headquarters to Saudi Arabia would be eligible for tax benefits.