Saudi’s Kingdom Holding buys 7% of Careem ride app

RIYADH — Saudi Arabia’s Kingdom Holding Co. said on Thursday it has bought a stake in car ride-hailing business Careem, its latest venture in the booming sector.

Kingdom Holding, chaired by Prince Al Waleed Bin Talal, acquired a 7 per cent share in the firm, valuing the transaction at $62 million.

Dubai’s Abraaj Group said in a separate statement that it has divested its shareholding in Careem.

It did not give the size of the stake, but confirmed it has been acquired by Kingdom Holding, a diversified Riyadh-based global investor.

The firm has stakes in a variety of sectors, including banking, through Citigroup, and media with Time Warner.

In 2015, Kingdom Holding invested more than $100 million in Lyft, a San Francisco-based rival to another US-based ride-hailing operation, Uber, which is a smartphone app that connects passengers and drivers.

“Our investment in Careem is a continuation of our strategy to invest in new technologies”, as it has already done with Lyft and stakes in Twitter and JD.com, Kingdom Holding’s CEO Talal Al Maiman said in a statement.

“Careem sets an example for regional businesses by providing employment opportunities to locals and developing talent,” he said.

Car booking apps are popular in Saudi Arabia, particularly among women who are banned from driving in the country.

As part of a wide-ranging plan to diversify its oil-dependent economy and give more jobs to Saudis, the kingdom is trying to develop its digital infrastructure and broaden its investment base.

In December, the largest Saudi telecommunication firm, STC, said it would buy a 10 per cent stake in Careem for $100 million.

Uber announced in June last year that Saudi Arabia’s Public Investment Fund would inject $3.5 billion to help the app’s global expansion.

Rival Careem operates in the Middle East and surrounding region.