The Saudi Iron & Steel Company (Hadeed) is set to undergo a transformative change as the Saudi Public Investment Fund (PIF) finalizes a monumental $3.3 billion acquisition, acquiring full ownership from the Saudi Basic Industries Corporation (SABIC). Concurrently, Hadeed will acquire the entirety of AlRajhi Steel Industries Company (Rajhi Steel) from Mohammed Abdulaziz AlRajhi & Sons Investment Company (Rajhi Invest), facilitated through the issuance of new shares in Hadeed.

This strategic move, announced in a statement by PIF, underscores a pivotal shift towards bolstering the construction industry in Saudi Arabia. By aligning with the objectives of Saudi Vision 2030, these acquisitions aim to fortify domestic industries to meet the escalating demands across various sectors including construction, automotive, utilities, renewable energy, transportation, and logistics.

Yazeed Al-Humied, Deputy Governor of PIF and Head of Middle East and North Africa Investments, emphasizes the significance of merging PIF's financial prowess with Hadeed and Rajhi Steel's technical acumen to forge a national leader in the steel sector. Analysts hail these transactions as instrumental in advancing the Saudi economy, particularly in globally pivotal economic sectors, by diversifying revenue streams and fostering financial resilience.

Abdullah Al-Jubaili, a financial analyst, sees these acquisitions as integral to the government's strategy to invigorate the construction sector, a cornerstone of economic growth. By consolidating Hadeed and Al Rajhi Steel into a single entity, Saudi Arabia aims to cultivate a formidable player capable of international competition and participation in large-scale projects both domestically and abroad.

Al-Jubaili notes the opportune timing of the acquisition amid challenges facing petrochemical companies, suggesting a strategic pivot for SABIC towards enhancing profitability in the petrochemical sector. With global pressures impacting prices and sales, the move allows SABIC to concentrate on its core strengths while leveraging the proceeds to bolster its presence in the petrochemical industry, potentially expanding capacities or introducing innovative products to the market.

In essence, these transactions signify a pivotal step towards fortifying the construction industry in Saudi Arabia, aligning with broader economic objectives and positioning the kingdom for sustained growth and competitiveness on the global stage.