PIF from Saudi Arabia sets up a company to stimulate the space sector

Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), has established a new company to support the development of the kingdom’s space and satellite sectors by developing local capabilities.

The new company, Neo Space Group (NSG), will invest in local and international assets and capabilities, as well as venture capital opportunities, to catalyze the development and localization of industry expertise.

“The establishment of NSG represents an important milestone in the development of Saudi Arabia’s growing satellite and space sector and its ambition to be a leading commercial player in the global satellite sector,” said Omar Al-Madhi, co-head of MENA Direct Investments at PIF.

“It will drive economic expansion in Saudi Arabia across several related strategic sectors while facilitating the location of key industries.”

In a statement, PIF said NSG’s goal is to develop and strengthen commercial space operations in Saudi Arabia while providing innovative satellite and space solutions around the world.

NSG will have four business segments including satellite communications, Earth observation and remote sensing, satellite navigation and Internet of Things, and a space-focused venture capital fund.

The company is expected to contribute to the development and implementation of cutting-edge technologies in the space industry.

Meanwhile, the development of the aerospace sector is in line with Saudi Arabia’s broader strategy to unlock the potential of promising sectors and support economic diversification away from heavy dependence under Vision 2030.

Earlier this year, PIF founded Alat to sign deals with international players and invest in large industrial companies that Saudi Arabia wants to set up locally. The investment company plans to invest $100 billion by 2030.

In May, Alat unveiled two new business units – electrification and artificial intelligence infrastructure – to strengthen global power grid technology and meet the growing demand for advanced AI infrastructure.

Meanwhile, PIF plays a key role in Crown Prince and Prime Minister Mohammad bin Salman’s plans to diversify the economy and move away from dependence on oil revenues by building new industries and investing in infrastructure development projects.

Since 2017, the $925 billion sovereign fund has created 94 new companies and more than 644,000 direct and indirect jobs. In October last year, MTP launched the Managers’ Gate platform and the Portfolio Management Development Program – a digital platform for cooperation between the fund and external fund managers.

PIFs accounted for about a quarter of the nearly $124 billion spent by sovereign wealth funds globally last year, according to Global SWF’s January report.

The fund has stakes in technology companies such as ride-hailing company Uber Technologies, football teams including Newcastle United of the English Premier League, electric car makers Lucid and Ceer, and is also financing a number of new cities in the desert such as the futuristic NEOM City worth 500 billion dollars and the Red Sea Development Company tourism megaproject.

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