- Jabal Omar Development Company (JODC), one of the largest real estate developers in the region, that operates residential projects within a walking distance of the Grand Mosque of Makkah is selling its debt to Alinma Investment Company, an investment banking firm in Saudi Arabia.
- The deal will see JODC issue more than 225m new shares to the Alinma Makkah Real Estate Fund to extinguish its debt worth 5.3b Riyals.
- This agreement will allow JODC to release itself from $143m debt as a part of its capital structure optimization plan. Shareholder funds for JODC will increase and interest will no longer be payable on the debt owed.
Why it matters
The real estate developer is on the right track for its growth and optimization plan after facing losses during the pandemic as travel bans reduced the numbers of pilgrims to the holy city of Makkah. However, tourists are returning now and JODC is moving back to business. Their srategy also aligns with Saudi Arabia's overall goal of diversifying its oil-based economy.
