Saudi Gazette report
RIYADH — The Public Investment Fund (PIF) has concluded an agreement with the Middle East Paper Company (MEPCO), a prominent manufacturer in the Middle East and North Africa focusing on paper-based products and recycling. PIF's acquisition of a 23.08% stake in MEPCO, facilitated by a capital increase and new share subscriptions, signifies a strategic expansion in the paper industry.
This investment by PIF is poised to enhance MEPCO's production capabilities, improve operational efficiency, and promote environmental sustainability through the production of recyclable paper goods. This aligns with the sustainability objectives of both Saudi Arabia and PIF.
Furthermore, the investment supports MEPCO’s growth strategy, particularly in the realms of packaging and specialized building materials like gypsum boards, thereby reinforcing the local supply chain for ongoing and future developments. PIF's diverse investments in construction services aim to bolster the sustainable growth of Saudi Arabia's economy, attract investments, increase operational capacities, and facilitate technology transfer.
PIF is actively contributing to the diversification of Saudi Arabia's economy in alignment with Vision 2030, focusing on 13 priority sectors including retail, construction, and real estate.
Muhammad Aldawood, head of Industrials and Mining Sector in MENA Investments at PIF, remarked on the the fund's role in tapping into the potential of sectors like recycling, retail, and building materials. He emphasized that the investment empowers MEPCO to enhance its sustainable production and focus on high-value-added products while expanding its export activities.
Eng. Sami Al Safran, CEO of MEPCO, said that the investment is instrumental in realizing MEPCO's expansion strategy and tapping into significant growth opportunities both locally and regionally. He highlighted MEPCO's commitment to sustainable growth and becoming a national leader in the industry, integrating paper products with waste management to support Saudi Arabia's sustainability goals and transition to a circular economy.
The Saudi market shows promising potential for investment in paper and related industries, such as tissues, owing to rapid growth and a drive toward localization of production. The PIF’s involvement in MEPCO also bolsters the private sector in Saudi Arabia, enhances local content, increases high-value exports, and elevates quality and competitiveness.
The transaction's completion followed approval from relevant authorities and MEPCO’s shareholders, who gave their nod in an extraordinary general body meeting.
