Riyadh, In a landmark step toward transforming its industrial landscape, SIDF Investment Company (SIC), the investment arm of the Saudi Industrial Development Fund, has entered into its first international private equity alliance with Investindustrial, a leading European private equity firm with €17 billion under management.
The agreement marks a major stride in aligning global capital with Saudi Arabia’s Vision 2030 goals, aiming to accelerate the Kingdom’s push toward localised advanced manufacturing and greater integration of domestic small and medium-sized enterprises (SMEs) into global value chains.
Announced in Riyadh at a high-level signing ceremony attended by Prince Sultan bin Khaled, vice chairman of SIC, and Carlo Baldocci, Italy’s Ambassador to Saudi Arabia, the partnership is set to serve as a key enabler of the National Industrial Strategy, which seeks to triple the number of factories in the Kingdom to 36,000 by 2035.
For SIC, the deal with Investindustrial signals the launch of an ambitious international investment strategy that complements earlier domestic efforts. In March, SIC partnered with Ashmore Investment Saudi Arabia to establish the Kingdom’s first private, closed-end industrial investment fund, worth SR400 million ($106.6 million). Managed by a global asset manager, the fund aims to stimulate long-term investment in a diverse range of industrial sectors.
“This agreement represents a new chapter for SIC,” said Fahad Al-Naeem, CEO of SIC. “We are forging a bridge between Saudi Arabia and the world’s most advanced industrial economies, bringing global reach, operational excellence, and manufacturing specialisation into our ecosystem.”
The new partnership targets high-value industrial segments including machinery, automation, medical devices, and sustainable consumer goods, with a strong focus on local value creation, technology transfer, and innovation-driven manufacturing.
Crucially, the deal also positions Saudi Arabia as a regional platform for industrial investment, allowing global players to establish a foothold in the Middle East and tap into international supply chains through the Kingdom’s expanding logistics infrastructure.
“SIC will leverage its market expertise to create pathways for global manufacturers,” Al-Naeem added, “offering a compelling value proposition built on Saudi Arabia’s competitive position, incentives, and long-term industrial vision.”
The timing couldn’t be more favourable. The Kingdom’s industrial indicators are on an upward trajectory: Saudi Arabia’s Industrial Production Index rose 3.1% year-on-year in April, driven by a 7.4% surge in manufacturing activity.
In May, the government unveiled the Standard Incentives for the Industrial Sector program, offering generous financing, up to 35% of capital expenditure per project, with a cap of SR50 million, to support both greenfield development and ongoing operations over a seven-year period.
These policy shifts are part of a broader move to position Saudi Arabia as a hub for resilient, export-oriented manufacturing, attracting international investors seeking growth outside of saturated Western markets.
For Investindustrial, the Kingdom represents a strategic expansion frontier. The firm, which operates eight offices worldwide and has a strong track record in mid-market industrial growth, sees Saudi Arabia as a natural extension of its portfolio’s global footprint.
“The Kingdom of Saudi Arabia has emerged as a key strategic growth region for Investindustrial’s companies,” said Andrea Bonomi, Chairman of Investindustrial. “Our values and investment priorities are aligned with the goals of Vision 2030, creating a fertile ground for sustainable long-term value creation.”
Indeed, the partnership exemplifies a new generation of cross-border industrial collaboration, where Gulf capital, European expertise, and Saudi market potential converge to drive transformation.
The SIC-Investindustrial deal also reinforces SIC’s growing role as a conduit for institutional-grade industrial capital, ensuring that Saudi Arabia is not only a recipient of global investment but an active architect of its direction.
As Riyadh deepens its diversification agenda, the partnership stands as a signal of confidence in the Kingdom’s industrial policy playbook and its ability to deliver growth beyond oil.
With international collaborations like this taking shape, Saudi Arabia’s ambition to become a regional manufacturing powerhouse is no longer just aspirational. It is becoming reality.