(Bloomberg) --
Saudi Binladin Group plans to hire more advisers to accelerate one of the Middle East’s biggest corporate-debt revamps and tackle its estimated $15 billion debt pile.
The kingdom’s top builder reached out to restructuring specialists across the Persian Gulf to assist with reorganizing the business, a spokesman for Jeddah-based SBG said in a text message. The consultants will assist Houlihan Lokey Inc., which was appointed in April to manage the group’s turnaround.
“Houlihan Lokey will be working with various consultants to review the business and charter a way forward for the newly capitalized SBG,” the company said in a statement.
The conglomerate, founded in 1931, was for decades the royal family’s favored builder until a deadly accident in the Islamic Holy city of Mecca five years ago resulted in SBG being banned from taking on new projects for about eight months. Its woes were compounded as work across the Middle East dried up in the wake of lower oil prices and the economic fallout of the coronavirus.
As part of the process of reducing expenses, SBG is imposing a hiring freeze and won’t pay staff at its headquarters in Jeddah for working overtime, according to an internal memorandum seen by Bloomberg. The company declined to comment on the contents of the memo.
Vision 2030
The latest cost-cutting measures come after the company put thousands of employees on indefinite leave in recent months and reduced salaries during the Holy Muslim month of Ramadan.
Saudi Arabia, through the Ministry of Finance, took a 36.2% stake in SBG’s parent, Binladin International Holding Group Co., to settle allegations of corruption. That came after Bakr Binladin, the half-brother of al-Qaeda founder Osama Bin Laden, was swept up in a crackdown against graft in November 2017.
The company has since overhauled its top management, including the appointment of a new group managing director, chief executive officer and head of its real estate unit. The builder is seeking to participate in Saudi Arabia’s push to diversify away from oil under an economic transformation plan known as Vision 2030.
“The renewed SBG is expected to play a vital role in the construction of the kingdom’s economy and be part of Saudi Arabia’s overall growth story in line with Vision 2030,” the company said.
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