Dubai-based private equity firm Abraaj Group is to close its office in Saudi Arabia, two sources familiar with the matter told Reuters on Tuesday.
One of the sources, a private equity-focused lawyer, said the office had become obsolete as Abraaj had people embedded within its portfolio companies, while its fundraising was done through licensed placement agents which did not require the business to have an on-the-ground presence.
Abraaj declined to comment.
The closure comes at a time when many other private equity firms have been targeting Saudi, often for the first time, seeking to buy into businesses benefiting from the kingdom’s young and increasingly-wealthy population.
Emerging markets-focused Abraaj opened the office in Riyadh in 2009 and set up a dedicated investment team to seek deals in the kingdom.
As recently as April, it completed a deal to buy a majority stake in Saudi Arabian fast-food chain Kudu with TPG Capital. It has a number of other investments in the kingdom including pharmaceutical firm Tadawi.
The Saudi office has been led by Hossam Radwan, according to the sources, who spoke on condition of anonymity as the information isn’t public. One, a regional private equity executive, added Radwan was expected to leave the firm.