Thursday, December 20, 2007

Saudi firm eyes Islamic debt to fund $2.9 bln project

Reuters (UK)

Saudi Arabia's Jabal Omar Development Co. awarded Binladin, the country's largest contractor, and Saudi Oger, owned by the family of former Lebanese prime minister Rafiq Hariri, the contract to build a $2.9 billion project in Mecca. In addition to a prayer area accommodating 65,000 people, the development will have 39 buildings including hotels, residences and retail facilities. Jabal Omar raised $537 million by selling a 30% stake in a November initial public offering (IPO) that valued the company at around $1.79 billion. The remaining 70% of the company is held by the owners of a 23 hectare (56.8 acre) plot of land in Mecca near the Grand Mosque. The cost of land in Mecca, Islam's holiest city, has surged, with land selling for as much $50,000 per square metre, according to government statistics. That compares with $14,522 per square metre in London and $24,900 per square metre in Monaco, according to the Global Property Guide.

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