One of the Gulf's biggest private equity firms is buying into a Saudi company in the middle of a regional war, betting that the kingdom's long-term growth outweighs the near-term risk.
Investcorp will take a large minority stake in REDA Gulf Holding, a fire-safety equipment maker, through its $500 million fund for Saudi companies preparing to list, the firm said in a statement. It joins a consortium led by AlTouq Group and Thara Future Investments. Terms were not disclosed.
"We look forward to working with the management team to deepen localization, expand into new markets and build a leading national Saudi company," said Hisham Attar, founder and managing partner of Thara Future Investments.
Why the timing matters
It is one of the first foreign deals into the kingdom since Iran-backed Houthi attacks escalated, and since Saudi Arabia postponed its flagship Future Investment Initiative conference to 2027.
Most foreign money is waiting on the sidelines. That hands the few buyers still writing cheques more leverage on price.
Bargain hunting?
No price was given, so there is no proof of a discount. But the backdrop favours buyers:
Cheaper markets. Saudi stocks hit a five-year low this month, before peace hopes sent the index back toward 10,000.
A motivated seller. REDA was already exploring its options with adviser Moelis & Co. last year, Bloomberg reported.
A pre-IPO play. Buying now and listing later lets the fund ride any recovery in valuations once the conflict fades.
Who is REDA
Founded in 1986, REDA Hazard Control supplies fire-safety and security systems to oil and gas, petrochemicals and aviation. Its clients include Aramco and SABIC.
It runs four factories in Saudi Arabia and operates in 19 countries. A war that puts energy sites at risk makes fire protection more critical, not less.
The big picture
Investcorp manages about $62 billion. REDA is the fifth bet for its Saudi pre-IPO fund, after Metra, NourNet, TruKKer and e-commerce platform Salla.
The deal also fits Riyadh's push to build local manufacturing and grow the non-oil economy, a plan the war has made harder and more expensive.
