Saudi Arabia’s M&A market gains momentum with 26 approvals in Feb

RIYADH: Saudi Arabia’s non-profit sector surpassed SR100 billion ($26.6 billion) in economic contribution in 2024 for the first time, accounting for 3.3 percent of the Kingdom’s gross domestic product, a new analysis revealed.

A report from the King Khalid Foundation highlighted that Awqaf represented SR48 billion of the SR114 billion generated, while non-profit organizations contributed SR47 billion in spending, based on data from the General Authority for Statistics.

The new figures fall in line with the Vision 2030 goal of lifting the sector’s contribution to 5 percent of the GDP by 2030. The division’s rapid growth is on track to achieve this goal two years ahead of schedule.

At the end of 2023, the non-profit sector contributed just under 0.9 percent to the economy, according to management consultancy Strategic Gears.

The KKF report further showed that volunteering added an estimated SR5 billion in economic value, while cooperative societies contributed SR2 billion, according to the Ministry of Human Resources and Social Development.

Regarding revenue generation, education and research organizations led the sector, exceeding SR19 billion, while health organizations recorded the highest spending at SR15 billion, driven by the conversion of government assets into non-profit entities. 

Organizations focused on culture, entertainment, and social services reported the highest employment rates.

The report further shed light on funding sources, stressing the role of government support and digital donation platforms, which collectively raised over SR15 billion in 2024.

The National Platform for Charitable Work, or Ehsan, saw a significant contribution from small donors, while major philanthropists, donations of SR100k or more, accounted for 26 percent of the total.

The analysis highlighted that on the community level, engagement in the non-profit sector remained strong, with 23 percent of Saudi citizens participating in volunteer work and 47 percent making donations in 2024.

Speaking to Arab News on the sidelines of COP16 in December, the CEO of the National Center for Non-Profit Sector Ahmed Al-Suwailem said that the Kingdom surpassed its Vision 2030 target of 1 million volunteers six years ahead of schedule.

During the interview, Al-Suwailem explained that the nation’s volunteering journey achieved the target just prior to the end of 2024. 

This falls in line with promoting the concept of volunteering and community participation in Saudi Arabia. 

RIYADH: US private equity firm Warburg Pincus is exploring financial opportunities in Saudi Arabia through an agreement signed with Hassana Investment Co., reinforcing their strategic partnership. 

According to a press release, the alliance aims to strengthen the two firms’ commitment to identifying and investing in high-growth sectors across various asset classes.

Many US businesses are exploring investment opportunities in Saudi Arabia, driven by the Kingdom’s expanding sectors, such as energy, tourism, and healthcare. 

With $7 trillion in government spending planned for Vision 2030 projects, the nation offers significant potential for US companies looking to expand and invest. 

“Through this collaboration, both firms will leverage their respective expertise to explore and execute investment opportunities that contribute to the Kingdom’s long-term economic growth,” the statement said.

The memorandum of understanding was signed during a roundtable discussion held at the Ministry of Investment and attended by the Assistant Minister, Chief Investment Officer for Regional Markets at Hassana, and CEO of Warburg Pincus.

Hani Al-Jehani, chief investment officer for International Markets at Hassana, said: “Our relationship with Warburg Pincus in international markets is a decade-long partnership, and we look forward to extending the partnership to consider potential opportunities in the Kingdom of Saudi Arabia.”

Al-Jehani noted that Warburg Pincus has “deep expertise” in several domains that align with the economic goals of the Kingdom and is entrusted by limited partners globally to manage their assets. 

“At Hassana, we look forward to expanding our cooperation to explore potential investment opportunities in the Kingdom, as it is witnessing economic transformations that reflect the objectives of Saudi Vision 2030, contributing to creating an attractive investment environment for local and international investors,” he added. 

CEO of Warburg Pincus, Jeffrey Perlman, added: “We see incredible investing opportunities in the Middle East. This agreement reflects our shared commitment to support growth in the Kingdom of Saudi Arabia.”

Perlman emphasized that the partnership deepens the relationships between the two regional firms and allows them to identify strong investment opportunities and management teams “looking for their next chapter of growth.”

Hassana Investment Co. is the investment manager for the General Organization for Social Insurance in Saudi Arabia. Managing one of the world’s largest pension funds with over SR1.2 trillion ($300 billion) in assets, Hassana focuses on long-term growth strategies to secure future retirement pensions for Saudi generations.

Founded in 1966, Warburg Pincus has $86 billion in assets under management and more than 230 active portfolio companies across various stages, sectors, and geographies, according to the press release.