In a strategic move aimed at strengthening its position in the Saudi market and diversifying its sources of income, the board of directors of Jaz Arabia Services Company announced yesterday its official approval to establish a new subsidiary with limited liability, which will be 100% owned by the parent company.
The company clarified in an official statement published on the Saudi Stock Exchange (Tadawul) website that the new company's capital will be one million Saudi riyals. The statement indicated that the new entity will specialize primarily in construction contracting and will commence operations as soon as it obtains all necessary official approvals and licenses from the relevant governmental and regulatory bodies in the Kingdom.
This move by “Jazz Arabia” is in line with the major urban and economic boom that the Kingdom of Saudi Arabia is witnessing under Vision 2030. The construction sector is currently one of the most vital and growing sectors in the Saudi economy, driven by the mega projects and huge infrastructure projects being implemented in various regions of the Kingdom, creating promising investment opportunities for companies wishing to expand.
Economic analysts believe that Jaz Arabia's entry into the contracting sector represents a significant shift in the company's business model. This horizontal expansion will support the company's current operations and enhance its future growth prospects. Furthermore, investing in a vital sector like construction will provide the company with new and sustainable revenue streams, strengthening its financial position and increasing its attractiveness to shareholders.
Through this move, the company aims to capitalize on the growing demand for construction services across the residential, commercial, and industrial sectors. The new subsidiary is expected to play a complementary role to the parent company's activities, reflecting the board's vision of seizing available investment opportunities in the local market and leveraging them to serve the long-term interests of the company and its shareholders.
