‘From Sofia with Business’
الأحد, 08 تشرين الأول 2023

From Sofia with Business

Last week, during my fact-finding trip to Sofia, I had the pleasant surprise of meeting Bulgarian President Rumen Radev when I met the economic advisory team at the Bulgarian presidential palace. My trip to Sofia was part of the due diligence exercise that we at BMG Financial Group need to perform before we start our private placement filing with the Capital Market Authority. That brief meeting with the president positively influenced our fact-finding mission.

BMG had signed this mandate to set up an infrastructure fund because of its alignment with the Kingdom's industrial and logistics vision. As we know it, Saudi Arabia is an essential international logistics hub due to its central location and large economy.

Over the past five years, Saudi Arabia has witnessed the most changes and advancements in the logistics and industrial activities in the region. According to a recent report issued by the Ministry of Industry and Mineral Resources’s National Industrial and Mining Information Center, the total number of industrial licenses issued by the ministry from the start of 2023 until the end of August amounted to 795.

These licenses were allocated across various industries, such as non-metallic minerals, rubber, plastics, paper, and metal products. Notably, the number of factories in Saudi Arabia has reached 11,110, with a total investment volume of SR1.489 trillion ($397 billion). The report indicated that the investment volume for the new licenses amounted to SR1.6 billion.

Following this fact-finding mission, my preliminary findings suggest that Riyadh and Sofia may indeed have strong industrial and logistical synergies. The presence of undervalued factories in various sectors, including energy substations, equipment, cargo drones, cranes, steel, and other heavy industries, presents a compelling case for bilateral investments and joint ventures.

A case in point is the recent acquisition by TAWAL, an ICT infrastructure subsidiary owned by Saudi Telecom Co., which acquired and now operates more than 4,800 sites across Bulgaria, Croatia, and Slovenia. This acquisition enables TAWAL to offer a full range of passive infrastructure services, including ground-based towers, rooftop installations, small cells, and in-building solutions. The agreement, valued at €1.22 billion ($1.293 billion), aligns with STC’s strategy to expand its international presence in key markets with significant growth potential, with Bulgaria being the primary focus.

Just as with the title of the James Bond movie starring the legendary Sean Connery, “From Russia with Love,” I adopt the title, “From Sofia with Business,” because I see industrial and logistical synergies between Riyadh and Sofia that can achieve strategic investment benefits for both nations.

Basil M.K. Al-Ghalayini is the chairman and CEO of BMG Financial Group.

Source Arab News




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