The business media sphere is abuzz with the findings of a new study highlighting the remarkable ascent of Private Equity (PE) initiatives in Saudi Arabia, with the apex reaching an impressive $4 billion in the year 2023. The ‘2019-2023 Saudi Arabia Private Equity Report’, released by the venture data authority MAGNiTT and backed by SVC, indicates a consistent upward trajectory in PE activities beginning in 2020, culminating in a surge of 3.7 times in 2021 and leaping to nearly 6 times that figure in 2022.
Transformations within the PE market composition are notably evident, as Buyout transactions have significantly increased by 20 percentage points in their overall market share from 2020 to 2023, while Growth transactions also witnessed a 2 percentage point uptick during the same timeframe. Dominating the investment scene, Buyout deals have consistently accounted for 80% of the total capital in PE transactions over the past five years. These trends highlight a strategic pivot in investment preferences, signaling the growing influence of Private Equity in Saudi Arabia’s financial framework.
The report also sheds light on the diverse nature of PE transactions, with particular industry focuses becoming prominent over the five-year span. The Food & Beverages sector stood out as the most frequently invested industry within the PE sphere. Manufacturing, however, notched the highest mark in terms of investment volume, securing 46% of the total capital allocated in the period.
Following the launch of the 2023 Saudi Venture Capital Report, we unveil the first-of-its-kind Private Equity report that covers the State of private equity in Saudi Arabia over the past five years and outlines its promising growth trajectory,
Dr. Nabeel Koshak, CEO and Board Member at SVC, remarked on the report. He underscored SVC’s steadfast dedication to nurturing the totality of Private Capital in Saudi Arabia by creating tailored investment programs and products, reflecting a deep understanding of the ecosystem’s needs and harmonizing with successful international models.
Philip Bahoshy, CEO of MAGNiTT, commented on the expansion of their research into the private equity domain, expressing enthusiasm for the inaugural Saudi Arabian Private Equity report in collaboration with SVC. The report underscores the critical role of private equity in sculpting the financial contours of the Kingdom and offers a window into the sectors and key players in the domain.