The Kingdom of Saudi Arabia has witnessed a remarkable surge in private equity (PE) activity over the past five years, reaching a pinnacle of approximately $4 billion in 2023, according to a new report.
Saudi Arabia’s landscape has displayed consistent growth since 2020, experiencing a substantial 3.7x rise in 2021 and further catapulting to 5.9x its 2021 level in 2022.
The data was published in the “2019-2023 Saudi Arabia Private Equity Report” published today by the venture data platform, MAGNiTT, and sponsored by SVC.
The report highlighted the shifts in the composition of PE transactions in Saudi Arabia during the years, with a pronounced emphasis on Buyout transactions. Between 2020 and 2023, buyout transactions witnessed a notable 20-percentage point increase in their share of the total, while growth transactions saw a growth of 2 percentage points over the same period.
Across the last five years, Buyout transactions have dominated the PE investment landscape, capturing an average of 80% of the total capital deployed in these transactions, the researchers found.
The report also revealed that the PE activity in the Kingdom has been characterised by significant transactional diversity and concentration in specific industries. Food & Beverages emerged as the most transacted industries within the PE landscape between 2019 and 2023. Interestingly, Manufacturing claimed the top spot in terms of total investment, commanding 46% of the capital deployed during this period.
“This report represents a significant milestone in our commitment to providing valuable market insights and contributing to understanding the evolving investment landscape in the Kingdom,” said Dr. Nabeel Koshak, CEO and Board Member at SVC.
“Alongside our commitment to the growth of Venture Capital, as reported in the 2023 Saudi Arabia Venture Capital Report published by MAGNiTT, we at SVC persist in our unwavering commitment to actively propelling the diverse facets of Private Capital in Saudi Arabia.”
Philip Bahoshy, CEO of MAGNiTT, added: “This report highlights the pivotal role of private equity in shaping the financial landscape of the Kingdom, while offering insights on industries and leading players within the space.”