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Saudi Arabian To Be Privatized  
User currently offlineMSYYZ From Canada, joined Oct 2005, 851 posts, RR: 8
Posted (8 years 5 months 4 weeks 21 hours ago) and read 3206 times:

After Egypt Air , MEA and Royal Jordanian ,yet another Middle Eastern Airline is talking about Privatization .

The Supreme Economic Council (SEC) has approved the executive program to privatize Saudi Arabian Airlines, amongst other decisions taken by the SEC. Like endorsing the executive program for the expansion and upgrading of the Haj Terminal at King Abdul Aziz International Airport in Jeddah.

Saudi Arabian Airlines has already taken a series of steps for its privatization, currently, the airline is focusing on transforming non-core units including catering, ground handling services and maintenance as well as the Prince Sultan Aviation Academy in Jeddah, into commercial units and profit centers. The airline announced that to this date, it has completed one of the three phases of its privatization plan, which included studies on the airline's financial, administrative, operational and organizational aspect as well as restructuring of its administration, finance and operation.

During 2005, Saudia posted a record revenue of SR 14.6 billion, which is SR 1 billion more than the figure of 2004, and it also achieved a net profit SR 500 million. This comes after MS , MEA and RJ were all in the black with good profit in 2005 .

What do you think Hijazzey ?


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User currently offlineA300 From United States of America, joined May 2004, 474 posts, RR: 0
Reply 1, posted (8 years 5 months 4 weeks 20 hours ago) and read 3186 times:
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Privatisation will only make sense if the aviation controls are relaxed in Saudi Arabia. It is very difficult for foreign airlines to compete. EK has only 5 RUH-DXB flights a week while SV has 14. Similarly, ME increased its RUH-BEY flights from 4 to 5 per week. They would like to go daily, but they cannot. LH has no rights on the DXB-MCT portion of its FRA-RUH-MCT flight. The fares are also high. There is no real competition here.


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User currently offlineBA From United States of America, joined May 2000, 11153 posts, RR: 58
Reply 2, posted (8 years 5 months 4 weeks 20 hours ago) and read 3173 times:

Quoting A300 (Reply 1):
Similarly, ME increased its RUH-BEY flights from 4 to 5 per week. They would like to go daily, but they cannot.

They were just recently granted the right to add a 6th weekly flight and it will start April 4.

But you're right, MEA wants to make it daily, but cannot do so. Maybe later this year, they will be granted the right to a 7th weekly to make it daily.



"Generosity is giving more than you can, and pride is taking less than you need." - Khalil Gibran
User currently offlineHiJazzey From Saudi Arabia, joined Sep 2005, 869 posts, RR: 1
Reply 3, posted (8 years 5 months 4 weeks 17 hours ago) and read 3116 times:

This is not new. The privatisation plan outlined above have been public for years now, but SV was seen dragging it's feet on this issue. Maybe the SEC will push this forward now.

As for aviation controls, I would love them to loosen, open skies even, but that isn't going to happen without reciprocation, and the other arab countries are just as bad. The examples listed above distort the picture. For example I could tell you that ME has more flights on the JED-BEY route than SV does. Doesn't give you the full picture.


User currently offlineMarkATL From United States of America, joined Jul 2004, 539 posts, RR: 8
Reply 4, posted (8 years 5 months 4 weeks 17 hours ago) and read 3112 times:

SV out of government hands. I can hear the new management now....Boeing? Who's Boeing....Never heard of 'em.


"...left my home in Georgia, 'n headed for the "Frisco" Bay...
User currently offlinePanAm747 From United States of America, joined Feb 2004, 4242 posts, RR: 8
Reply 5, posted (8 years 5 months 4 weeks 17 hours ago) and read 3108 times:

Interesting term - privitization. Will any foreign or non-muslim group be allowed any kind of ownership at all?

And if it is sold only to Saudi Arabians, will that mean every prince in the country gets to own a piece of the airline?

I wish the airline well - it functions well consider the unique circumstances that is the country of Saudi Arabia.



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User currently offlineHiJazzey From Saudi Arabia, joined Sep 2005, 869 posts, RR: 1
Reply 6, posted (8 years 5 months 4 weeks 17 hours ago) and read 3084 times:

Privatisation means they will be turned into a joint stock company and listed on the Saudi stock exchange. What percentage of the company will be made available at IPO, I don't know, but the government would no doubt have a significant stake in the company or at the very least a golden share. So a takeover by a foreign carrier would be unthinkable.

BTW, the business community in Saudi is composed mainly by the traditional merchant families, not the royal family.


User currently offlineKHI747 From United States of America, joined Oct 2000, 1615 posts, RR: 1
Reply 7, posted (8 years 5 months 4 weeks 7 hours ago) and read 3011 times:

This is great news and i think SV has so much unrealized potential as an airline that can only be fixed if its privatized.

As to how the airline would be privatized,they would offer it to a certain group of investors who in all probability would be from GCC only if not Saudi entirely. But i think someone like Prince Waleed bin Talal would be VERY interested in a privatization like this in the kingdom


User currently offlineHiJazzey From Saudi Arabia, joined Sep 2005, 869 posts, RR: 1
Reply 8, posted (8 years 5 months 2 weeks 6 days 14 hours ago) and read 2917 times:

Just a quick update...

According to local papers, SV has submitted it's application to list on Tadawul to the CMA. They're planning to offer 30% in an IPO later this year.

It appears they're moving ahead.


User currently offlineBilly From United Kingdom, joined Jul 2000, 895 posts, RR: 7
Reply 9, posted (8 years 5 months 2 weeks 6 days 14 hours ago) and read 2905 times:

Sama is struggling to gets its approvals from the GACA. They want to base a plane in DMM, amongst others. No international flights will be approved until they have a dometic track record.

And Almost all GCC flights are heavily restricted. Oman Air wants daily DMM-MCT, but is restricted, hence it is in BAH. QR wants three daily DMM-DOH, and KU wants daily DMM-KWI, for example.

The Saudis are playing hard ball with GCC carriers who 'steal' sixth freedom traffic. I am not sure that this situation will change much in the short term either.


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