Saudi Arabia’s Public Investment Fund has increased its stake in the kingdom’s utility developer Acwa Power from 33.36 per cent to 50 per cent, the companies said in a statement on Friday.
The investment comes as part of PIF’s strategy to support the development of the renewable energy sector in Saudi Arabia, said the sovereign wealth fund. It did not disclose the dollar value of the new investment.
It will enable the "growth of national champions to become regional and global leaders", while also realising sustainable investment returns, it added.
"[The] increased stake is an endorsement of Acwa Power’s ambition and progress. PIF is a long-term investor and is committed to actively enable the development of key economic sectors, such as renewables, in Saudi Arabia,” PIF said.
“We believe that Acwa Power will play a significant role in both driving and diversifying economic growth in the future… while also providing enduring commercial return for the people of the kingdom.”
PIF’s increased stake in the developer is an indication that Saudi Arabia, Arab world’s biggest economy, is increasingly pivoting towards cleaner energy. The kingdom has major plans to develop its renewable energy industry as it seeks to diversify its economy away from oil.
PIF made its first direct investment in Acwa Power in 2018. Its fully-owned subsidiary Sanabil Direct Investments Company initially invested in Acwa Power in 2013.
“It is with much pleasure that we announce the closure of this key transaction for the mutual benefit of the company, its shareholders and the kingdom as a whole,” said Mohammad Abunayyan, chairman of Acwa Power.
“The additional investment by the PIF is a vote of confidence in our ability to deliver sustainable, resilient growth without compromising environmental stewardship, social responsibility and good governance,” he added.
Founded in 2004, Riyadh-based Acwa Power has grown rapidly and evolved into one of the leading independent power generation and desalinated water producers in the world.
Including its assets that are under construction, or are in advanced development, 74 per cent of the total gross capacity of the company’s portfolio is dedicated to clean and low carbon power technologies.
Co-owned by nine Saudi conglomerates, including the Vision International Investment Company, the PIF, the Saudi Public Pensions Agency and the International Finance Corporation, Acwa Power operates in 12 countries in the Middle East, Africa and central and south-east Asia.
It has a portfolio of 58 assets with a total investment of $59.9 billion producing 37.7 gigawatts of power and 5.8 million cubic metres per day of desalinated water.