Plan to open Saudi market excludes Makkah builders
Foreigners will not be able to invest in Jabal Omar, MCDC or Taiba
Saudi Arabia's plan to open its stockmarket up to international investors will not extend as far as construction and development firms involved in the widespread redevelopment of its holy cities of Makkah and Madinah.
According to the Saudi Gazette, a report produced by Makkah's Chamber of Commercie and Industry highlights a bylaw in the foreign investment rules which bans investors from outside the country from buying or owning shares in companies working in Makkah and Madinah.
This will involve Jabal Omar for Development - the firm building over 50 high-rise towers in an area around Makkah's Grand Mosque - Makkah Construction & Development Company and developer Taiba Holding, which is working on projects in the centre of Madinah. The constitutions of the individual companies also bar foreign ownership.
Between them, the three firms have a market capitalisation of $18.6bn - slightly over 3% of the market total. Jabal Omar is the biggest of them with a market cap of $13bn, Makkah Construction & Development Co has a value of $3.7bn and Taiba Holding $1.9bn.
The new rules proposing to allow an amount of foreign ownership of Saudi shares are still under discussion, but currently a ceiling of 49% has been set for the total level of ownership in any single company, and individuals cannot own more than 5% of a firm.