Saudi Arabia's Kingdom Holding Company (KHC), the investment firm owned by billionaire Prince Alwaleed bin Talal, has acquired a 7.11 percent stake in Dubai-based ride hailing service Careem for $62 million, Reuters reported on Thursday.
The KHC deal came about after United Arab Emirates-based investment firm The Abraaj Group divested its stake in Careem, a major regional rival to international app Uber.
Founded in 2012, Careem is active in 80 cities across the Middle East, North Africa, Turkey and Pakistan, up from 20 at the time of Abraaj’s investment in 2015.
“The Abraaj Group has been a great partner for us over the past two years, and the company’s unique regional insights and global resources has been a major contributor to our current success. We will continue to expand, innovate, lead and serve our mission of simplifying the lives of people in the region,” Mudassir Sheikha, co-founder of Careem, said in a press statement issued by Abraaj on Thursday.
The KHC deal is part of a wider $350 million fundraising drive by Careem, including new investors such as carmaker Daimler, venture capital firm DCM Ventures and hedge fund Coatue Management, Reuters reported.
The cash brings the total investment in Careem to $500 million, after the government controlled Saudi Telecom Co invested $150 million last December.
KHC has minority stakes in some of the world's top companies, including Citigroup, Rupert Murdoch's News Corp and microblogging site Twitter
“Our investment in Careem is a continuation of our strategy to invest in new technologies as we have done with our investments in Twitter, JD.com and Lyft,” KHC’s CEO Talal Ibrahim Al Maiman said in a press statement.
“As the leading ride hailing company in the region, and positioned with excellent growth prospects, Careem sets an example for regional businesses by providing employment opportunities to locals and developing talent.”
Last month it reported net profit of 129.1 million Saudi riyals ($34.42 million) in the first quarter of 2017, an increase of 12.7 percent compared the same period last year.
In December 2015 it was reported that a group of investors led by KHC had invested $247.7 million in San Francisco-based ride hailing app Lyft, another rival to Uber.
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