Gulf Construction Online

Saudi Focus

Update

01 May 2016

Export ban on cement, steel lifted

Saudi Arabia has lifted bans on exporting cement and steel, reports said quoting officials and sources.

Ahmed bin Abduh Zugail, who is chief executive of Yanbu Cement Company and the deputy head of the national committee of cement companies, told the Al Riyadh newspaper that cement companies welcomed the move but were awaiting details of the new rules from the Ministry of Commerce.

The Saudi government imposed a ban on cement exports in 2008 to push prices down and accommodate demand from large government-funded infrastructure projects, although some companies were allowed to export at prices lower than those in the local market.

Steel rebar exports have been similarly restricted.

Sidra inks Jeddah residential project

Sidra Capital, a Shari’ah compliant financial services company, has been signed up as investment advisor for a group of investors in Eden Residence, a SR80-million ($21.3 million) luxury residential project in Jeddah.

The residential and retail development will offer 58 units with configurations ranging from studio to three-bedroom units besides 10 retail units. The project is targeted for completion by mid-2018.

The project is being developed by Al Murjan Holding, Mohamad Zouheir Al Azem, a partner in Nawa Real Estate Development (Nawa), and Amer Zein El Abdin, the president of National Marketing Company. Nawa is the development manager for the project.

Hill wins five-star hotel deal

Hill International has secured a two-year contract worth $2.7 million from Dur Hospitality to manage the construction of a five-star hotel in Riyadh.

The upcoming Diplomatic Quarter Marriott Hotel will boast 80 rooms besides 140 residential apartments. It will also feature a conference centre, ballroom and a 220-slot parking garage. The 39,000-sq-m project is expected to achieve Leed (Leadership in Energy and Environmental Design) Silver certification.

Dur Hospitality, formerly known as Saudi Hotels and Resorts Company (Sharaco), is a major player in the hospitality and real estate sector in the kingdom.

Red Sea Housing buys prefab firm

Saudi Arabia’s Red Sea Housing Services has bought AM Modular, a leading designer and manufacturer of prefabricated modular buildings in Malaysia.

The acquisition is Red Sea Housing Services’s first of its kind in Asia. The SR26.2-million ($7 million) buyout includes a down payment of SR11.2 million ($3 million) to be made this year. The remaining SR15 million ($4 million) will be made over the next three years for a total of 90 per cent of AM Modular’s shares.

SNC-Lavalin wins asphalt plant deal

SNC-Lavalin has won an engineering, procurement and construction (EPC) contract from Saudi Aramco for the expansion of the asphalt production facilities at its Ras Tanura Refinery in the Eastern Province.

Upon completion of the expansion in 18 months, asphalt production capacity at the facility will increase from 22,000 barrels per day (bpd) to 42,000 bpd. The contract will be executed by SNC-Lavalin’s in-kingdom entity, Saudi Arabian Kentz.

SNC-Lavalin will provide comprehensive engineering and detailed design, procurement, installation, construction, pre-commissioning and commissioning, necessary for the project completion and plant start-up.

Khodari’s Q1 profit plunges 71pc

Saudi Arabia’S Abdullah Abdul Mohsin Al Khodari and Sons reported a 70.6 per cent drop in first-quarter net profit as it continued to struggle amid a slowdown in the construction sector.

The contractor made a profit of SR4.11 million ($1.10 million) in the three months to March 31, down from SR13.98 million ($3.72 million) in the same quarter last year. It cited a 16.4 per cent drop in revenue for the profit decline as well as a fall in its gross margin, which was impacted by the higher costs of completing projects.

Khodari won SR16.2 million ($4.3 million) of new contract awards in the first quarter, down from SR1.1 billion ($293 million) in the corresponding period of 2015. Contract awards had also slumped significantly in the third and fourth quarter of last year.

Jotun campagin rewards customers

Jotun last month kicked off a campaign in Saudi Arabia designed to focus attention on its premium brands Jotashield, Fenomastic and Lady Design.

Under the campaign open to registered customers, Jotun is giving daily prizes of mobile phones and tablets, as well as five grand prizes of furniture worth SR20,000 (5,331) each to five lucky winners.

The campaign ends May 13.

Key Clifford role in real estate deal

International law firm Clifford Chance said it has played a key role in helping Saudi-based Al Tayyar Group acquire a 30 per cent stake in Thaker Investments and Real Estate Company for SR803.8 million ($214 million).

Thaker is a major player in the real estate development scene in Makkah, while Al Tayyar Group is a major tourism company in the Gulf region listed on the Saudi stock exchange.

Clifford Chance was the key advisor for the Saudi travel group in one of the major real estate merger and acquisition (M&A) transactions in the kingdom. The deal was completed through share transfer.