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The AlBawani way of redefining diversification

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AlBawani Holding currently has over SAR 9 billion worth of ongoing projects

AlBawani Holding Company, a diversified Saudi Arabia-based conglomerate, registered a business growth of 39% in 2022, and anticipates its revenue to increase over SAR 20 billion by 2027, Eng. Fakher AlShawaf, Chairman of the company, stated recently.

The group, which was established in 1991, currently operates in several sectors including construction, specialised contracting, water and power, facility management, manufacturing, MEP solutions, technology, and investment in public-private partnerships (PPPs). As the Kingdom sets its eyes towards the goal of ensuring a well-diversified economy by 2030, AlBawani Holding is set to play a crucial role in implementing the roadmap.

Knowing the venture in detail

“The past three decades have seen our business grow from a modest civil-works firm into a fully ledged general contracting corporation with a sizable portfolio, strong financial position, and a significant presence in a broad range of industries. Indeed, our construction division is now among the five largest operators in the country. What’s more, our unwavering focus on excellence has earned us a Class-1 business ranking in Saudi Arabia,” the venture told International Finance.

Till November 2023, the venture has completed over 260 projects, apart from building long-term partnerships and in that process, earning the trust and loyalty of its clients. AlBawani Holding currently has over SAR 9 billion worth of ongoing projects. The company has a 15,000-strong workforce, with each of them being a specialist in different industrial verticals.

The group believes in adhering to international standards and developing rigorous quality management systems in its business sectors. The company has also established rigorous procedures to ensure the safety of its personnel, minimise errors and deliver the projects within the time and budget.

At the core of AlBawani Holding’s business practises, resides world-class engineering, administrative, and technical practises, supported by cutting-edge technology and integrated support services.

“We are now investing in the future so that we can introduce the latest technology and knowledge to the Kingdom. This will allow us to harmonise with the objectives of Vision 2030: a striving economy, a vibrant society, and an ambitious nation,” the venture stated further.

AlBawani’s mission is to provide the best innovative contracting and services in EPC (Engineering, Procurement and Construction), Energy, Water, Technology and Light Industry, apart from achieving sustainable growth through its investment arm. Keeping the ‘Vision 2030’ in mind, AlBawani will lead sustainable growth in the Kingdom by creating the best value for its clients, investors, employees and Saudi society, while sticking to the group’s core values such as quality, safety and health, innovation, ethics and culture, sustainability and people-centric relationships.

How the company works

AlBawani is known for bringing complex and logistically challenging projects from the drawing board to reality. Through the deployment of a 6000-employee-strong workforce across the infrastructure projects, the venture delivers its commitment towards ensuring quality and safety.

“Our global network of construction resources facilitates the effective mobilisation of skilled construction teams and advanced methodologies around the world. AlBawani has extensive experience with local considerations and managing culturally diverse workforces,” the venture commented further.

The company often engages clients to support start-up and commissioning activities. The group responds to the challenge by developing a detailed ‘Project Commissioning Manual’ early in the engineering phase that outlines the client’s and AlBawani’s approach and methodology to implementing continuous commissioning and turnover.

AlBawani’s specialists are veterans in the field of construction execution methods, including constructability, skill certification, industrial relations, modularisation, and welding services. These professionals deliver input into the construction range, enhancing manufacturing activities and proposing cost-saving ideas during all project phases.

AlBawani integrates complete construction competence during the various project implementation phases.

“When executed at the front end of a project, this expertise enhances performance throughout all project execution phases. Skilled planning and execution supports the efficient use of just-in-time inventory and can hasten the project schedule,” the venture noted.

AlBawani practises advanced construction approaches on its projects, apart from acquiring labour through carefully selected subcontractors with a verified history of safety performance, execution excellence and commercial success. The focus remains on constructability, performance engineering, welding, and software systems.

AlBawani also preserves a database of craft personnel with both local and global project experience. From this pool, craft personnel get assigned to the construction projects based on experience and availability. The company also supports the needs of construction projects for entry-level through the upgradation of craft and supervisory training and skill certification, while using the materials developed specifically for the construction industry.

Also, the venture maintains a deep assurance of the field employees’ health and safety, apart from safeguarding the environment. Its quality programme is ISO 9001:2008 certified. The programme applies to both self-perform and project administration construction work. A quality manager is assigned to each project and is accountable for the execution and coordination of the quality programme.

In addition to construction services, AlBawani implements a complete Health, Safety & Environmental (HSE) programme on every project it executes. Safety, be it that of the project or the field teams associated with it, occupies a significant chunk in AlBawani’s business practises, as it believes that “positive execution of complex projects can be achieved only with a healthy and safe workforce of employees, subcontractors and client personnel.”

“AlBawani’s engineering, procurement and construction projects are construction-focused. We confirm a smooth transition from process development and optimisation-driven execution defined by the study phases, to a construction and start-up-driven execution platform defined by engineering, procurement and construction phase,” the group remarked further.

“AlBawani thinks first and foremost about fulfilling project construction. Then we work backward, framing how to get materials to the various sites. After this, AlBawani determines how and where to drive engineering,” it added further.

AlBawani tailors its solutions as per the Clients’ requirements, while bringing ideas from engineering disciplines like civil, electrical, mechanical, piping and structural into the play, apart from onboarding advanced specialities such as simulation, enterprise integration and integrated automation processes.

The venture also collaborates with its client counterparts to develop integrated construction and project management solutions. From the earliest stages of project design, AlBawani involves the construction and commissioning teams to provide capital and schedule efficiencies.

“Our clients rely on AlBawani for accurate and timely design reviews. We conduct design reviews at key project stages to ensure consistent, efficient focus on the clients’ deliverables throughout the design process,” it added further.

AlBawani’s BMF Reviews (Buildability, Maintainability and Functionability Reviews) earned its fame for highlighting, addressing and resolving issues early in the design process for an efficient design and construction process, apart from minimising overall project cost.

Keeping the need to meet clients’ objectives for throughput capacity and quality of output as the primary project design goal, AlBawani, during the detailed engineering and design phase, develops plans to ensure that the designs reflect client requirements and facilitate the construction of facilities meeting the client’s strategic objectives.

Each project’s function, scope, cost and schedule get conceptually aligned with client objectives to optimise project success, while ensuring the improvement in the client’s return on investment.

During the design phase, AlBawani gets proactive, in terms of providing effective building solutions, and identifying challenges to mitigate design changes after construction commencement. This involves detailed pre-construction planning, which allows the client and AlBawani project team to form a clear roadmap for the bidding process, construction phase, and completion deadlines.

Diversification is the game here

Be it building a network of schools under the Kingdom’s ‘National Schools Programme’, completing terminal-related works under Riyadh Airports Company Private Aviation or implementing the ‘Red Sea Tourism Project’, you name any sector, AlBawani is there to turn the dream into a reality.

AlBawani has been bringing tailored engineering solutions to as many as 14 non-oil industrial verticals within the Kingdom. AlBawani is now expanding its network of affiliated companies in other fields like information technology and communication systems, trading, media and publishing, electro-mechanical, steel and metal fabrication, industrial and investments.

From water and power utilities, automation, avionics, defence technologies, specialised manufacturing services (like in-house precast, casework, ducting, steel fabrication, aluminium and woodworks factories), facility management or managing a diverse portfolio of highly profitable investments, AlBawani has been aggressively diversifying its company portfolio, while leading the Saudi’s diversification efforts with full vigour.

AlBawani has made a significant investment in new equipment, and the company now has over one thousand heavy assets in its fleet including heavy machinery, cranes, trailers, light vehicles, and power tools. Also, it is now expanding its operations in countries like China, Turkey and the UAE.

AlBawani’s growth plans

As part of its growth plans, the AlBawani group has adopted a wise expansion strategy covering energy and mining, apart from increasing investment in assets which will be offered through state funds, and governmental and private projects.

AlBawani’s board of directors is also considering selling a stake in the company through an initial public offering (IPO) in the coming years.

“Driven by a steadfast commitment to fostering sustainable growth, AlBawani Holding Group is actively considering an initial public offering (IPO) to make a portion of its shares available for public subscription in the near future. We are open to any strategic initiative that can further enhance the group’s value and propel its growth trajectory. As a leading national enterprise, AlBawani Holding Group is determined to play a pivotal role across diverse sectors and establish itself as a formidable competitor for global players,” AlBawani Holding CEO Eng. Fakher AlShawaf elaborated.

“Since its inception, AlBawani Holding Group has navigated a course through significant challenges, and has emerged as a firmly established entity – a testament to its unwavering determination, unflinching dedication, and tireless efforts. Moreover, the steadfast support of the Saudi government has been instrumental in empowering national companies to assume pivotal roles, thanks to the launch of numerous infrastructure projects and legislative reforms,” he added.

Eng. Fakher AlShawaf emphasised the transformative impact of Saudi Vision 2030 in propelling the kingdom to a prominent global position. He underscored AlBawani Holding

Group’s commitment to aligning its strategies with the successive short- and long-term growth plans outlined in the vision.

“This proactive approach has enabled the group to successfully execute a multitude of large-scale projects across the kingdom,” he stated further.

A partnership with the Saudi government-backed Public Investment Fund (PIF) also represents a unique opportunity for the AlBawani group to leverage the Fund’s vast expertise and the opportunities it presents, thereby elevating itself as a pioneering diversified conglomerate within the MENA (Middle East and North Africa) region and beyond, while consistently delivering exceptional services and value to its clients, employees, and the society at large.

Eng. AlShawaf also noted the PIF’s crucial role in the Kingdom’s construction sector, considering its paramount importance to the country’s economy. He also added that the Fund’s investments would play a pivotal role in the realisation of ‘Vision 2030’ and its ambitious projects.

He sees the construction sector’s significant role in the evolving dynamics of the Saudi economy.

As the Kingdom has the goal of becoming one of the global economic powerhouses by 2030, its construction sector is facing the challenge of executing diverse projects on a sheer scale never seen before. The answer lies in engaging companies possessing the necessary expertise, planning skills, preparedness, and effective leadership to navigate the complexities and deliver exceptional results. AlBawani perfectly sits in the bracket, as its construction division AlBawani Construction Company (ABCC) is consistently demonstrating its ability to complete large-scale projects in a cost-efficient manner, while meeting the highest quality standards.

Among the ongoing key development projects in the Kingdom, a majority of them are centred around real estate, Eng. AlShawaf said.

These include initiatives led by the Ministry of Housing and its affiliated companies, as well as flagship programmes like Neom, The Red Sea Project, and Qiddiya.

The Kingdom is poised to attract a plethora of construction and investment projects. Talking about a project as diverse as Neom, AlBawani has successfully executed the assignment given to it by the Saudi government.

These large-scale initiatives span various domains and position the kingdom as an attractive destination, Eng. AlShawaf elaborated, while stating that AlBawani, through its various company divisions, is getting involved in these projects.

In the investment sector, the venture is currently holding significant assets in partnership with the government. Eng. AlShawaf also talked about AlBawani’s successful operation of the Jubail III water treatment plant in collaboration with other Saudi investors.

“Furthermore, we have embarked on the first educational infrastructure project in conjunction with the Ministry of Finance, the National Centre for Privatisation (NCP), and Tatweer Buildings Company (TBC). The first phase of this project has already been completed in Jeddah, with assets affiliated with the educational buildings in Makkah set to be delivered by the year-end. We intend to enter into several long-term ownership agreements, extending up to 22 years, with various agencies, and in coordination and collaboration with various AlBawani group companies,” the official added further.

Talking about AlBawani’s involvement in health sector projects, Eng. AlShawaf noted that the privatisation of the sector will attract substantial investments. His venture, apart from completing projects in this realm, has emerged as one of the leading specialised companies in this field.

AlBawani, as of November 2023, has a big-ticket project in hand in the form of establishing American electric vehicle maker Lucid’s factory in the Kingdom, which is also one of the largest EV production facilities outside of the United States. AlBawani completed the construction of the first phase of the factory in a record time (in less than two years), as the facility was inaugurated on September 27, 2023.

The company began construction of the Lucid factory’s first phase in May 2022. The future phases will consist of many buildings across the EV venture’s 1.3-million-sq-m campus plot at the King Abdullah Economic City (KAEC).

AlBawani has also established the National Construction Academy (NCA), a non-profit national training institute. The facility has already commenced the training of 500 students, which will be increased to 1,000 in the upcoming session.

AlBawani, in collaboration with another technical institute, will expand the scope of training and introduce new specialisations that can cater to the needs of the 21st century construction and contracting industry.

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