Dubai-listed investment bank Shuaa Capital said it has closed the sale of its Saudi hospitality asset portfolio to Saudi-based prominent real estate investor Sumou Holding. The sale is valued at 515 million riyals ($137 million) and forms part of a larger effort on the part of Shuaa to streamline its operations and enhance its financial health.
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The hospitality portfolio, managed by Shuaa Capital Saudi Arabia, a wholly owned subsidiary of the Dubai-listed firm, comprised three properties strategically located in Riyadh, Jeddah, and Dammam. Shuaa held a 33% equity stake in the portfolio, and the sale is expected to positively impact the company’s financial standing. The transaction will help Shuaa reduce its liabilities while adding 19.6 million UAE dirhams ($5.3 million) to its balance sheet.
Shuaa Capital has described the sale as part of its broader strategy to “refine its investment focus.” This move is in accordance with the long-term goal of the company toward optimizing asset allocation for sustainable growth. The move reflects the firm’s commitment toward prioritizing its core strengths and enhancement of operational efficiency, especially in a critical phase of restructuring.
It follows a recent significant milestone for Shuaa’s debt restructuring. The company has recently approved $116 million in mandatory convertible bonds, issued across two tranches. MCBs are a critical constituent of the efforts undertaken by the firm to reinforce its financial health and steady its course in the face of an unfavourable economic scenario.
This deal also happens at a time when there have been other developments in the leadership of Shuaa. Just in less than two weeks, the managing director of the board of directors of Shuaa, Ahmed AlAhmadi, resigned after working for the company in what it said was a “meaningful role” to optimize the capital of its restructurings.
Selling it as a step towards focusing on its core investment areas and becoming more resilient in its finances, Shuaa Capital has positioned the sale. By divesting non-core assets like the Saudi hospitality portfolio, the company will hopefully streamline operations, reduce financial risk, and become more resource-efficient.
The deal once again highlights the overall goal of Shuaa to transform in alignment with market conditions and yet keep shareholder value at the forefront. As part of its restructuring journey, Shuaa continues to strive to refine its investment approach toward achieving long-term objectives.
This divestment, coupled with the recently approved convertible bonds, signals Shuaa’s determination to stabilise and optimise its operations, reinforcing its position in a competitive market. The sale of its Saudi hospitality assets marks another milestone in the company’s ongoing transformation.
