Riyadh — Saudi Arabia’s main sovereign wealth fund said it planned to enter the cinema business with major US-based movie exhibition company AMC Entertainment Holdings, as the Kingdom lifts a 35-year-old ban on cinemas.
“In line with the fund’s mandate to help unlock promising new sectors within the Kingdom, the Public Investment Fund (PIF) and AMC Entertainment will explore theatrical exhibition and related investment and partnership opportunities in Saudi Arabia,” the PIF said.
The agreement builds on the announcement of the General Commission for Audiovisual Media’s (GCAM) decision to grant domestic licenses to cinema providers, and directly supports the Vision 2030 objective of growing household spending on entertainment from 2.9% to 6.0% of GDP, it said.
“This announcement is a historic moment for the theatrical exhibition industry and a tremendous opportunity to connect AMC’s movie products with the Kingdom of Saudi Arabia’s more than 30 million citizens, many of whom we know are movie fans based on their regular visits to cinemas in neighboring countries,” AMC CEO-president Adam Aron said in a statement.
“PIF sees huge potential in the Kingdom’s entertainment sector. We look forward to working with AMC Entertainment Holdings to explore opportunities in developing an industry that is expected to be around $1 billion in size,” a PIF spokesman said.
The Saudi government announced on Monday that the first theaters could start showing films as early as March, part of a liberalizing reform drive that has opened the door to concerts, comedy shows and women drivers in the past year.
AMC, which owns the Odeon brand, is one of the largest movie exhibition companies in the world with about 1,000 theaters and 11,000 screens across the globe.
Other cinema chains are also eyeing the Saudi market. Dubai-based mall operator Majid Al Futtaim, which owns VOX Cinemas, said it wanted to open the first movie theater in the Kingdom.
The government said it expected to open over 300 cinemas with more than 2,000 screens by 2030.
With assets of over $220 billion, the PIF is being used by the government to spearhead its drive to diversify the Saudi economy beyond oil. The fund is getting into a wide range of industries from real estate development to technology investment, tourism and waste recycling. — Agencies
— Reprinted with permission of the Saudi Gazette.