Red Sea Global, the company responsible for a major tourist attraction on Saudi Arabia's Red Sea coast, is exploring a potential public market offering in 2026. John Pagano, the CEO, revealed the firm is in initial discussions with stakeholders and banks but did not provide further details on valuation or advisers. The offering is expected to happen after the hotels have been operational for two years and have a proven track record of profitability, occupancy, and cash flow. The company is primarily focused on establishing a revenue stream that supports its value.
The development aims to attract luxury travelers from the region and beyond, capitalizing on the Red Sea's 90-island archipelago and new resorts being built along the coast and green mountains in the south. The project is a central piece in Saudi Arabia's push to establish itself as a top tourism destination, with plans to invest billions in a new airline, airport, entertainment hub near the capital, and a new $500 billion city called Neom in the northwest.
Why it matters
Red Sea Global, created by Saudi Arabia's sovereign wealth fund through the merger of two state-controlled developers, will complete the first phase of its project by the end of 2024. The company borrowed $3.8 billion for this phase, which includes hotels and an international airport. The planned 16 resorts will add 4,200 rooms. Pagano sees potential in the millions of pilgrims traveling to Mecca and Medina who may extend their stays and explore other parts of the kingdom.