Abdulaziz Alajlan & Partners Advised PIF and Pirelli on Saudi Tyre Manufacturing Joint Venture

Abdulaziz Alajlan & Partners Advised PIF and Pirelli on Saudi Tyre Manufacturing Joint Venture

Abdulaziz Alajlan & Partners, joined hands with global law firm Baker McKenzie's offices in London, Milan, and Dubai, to offer legal guidance to the Public Investment Fund (PIF), Saudi Arabia's sovereign wealth fund. The collaboration led to the formation of a joint venture with the global tire manufacturer Pirelli Tyre, resulting in the establishment of a dedicated company aimed at constructing and operating a state-of-the-art tyre manufacturing plant in Saudi Arabia.

Karim Nassar, a senior legal consultant, conveyed his pride at being selected to offer legal counsel for this important joint venture agreement. He lauded PIF's dedication to advancing the Kingdom's economic development and underscored the innovative nature of this collaboration.

PIF will secure the majority stake in the joint venture, amounting to 75 per cent, with Pirelli holding the remaining 25 per cent as a technology partner, providing crucial technical, industrial, and commercial support for the plant's development. The joint venture is expected to witness an approximate investment of $550 million.

Phelim O'Doherty, another member of the advisory team, expressed their pleasure in delivering comprehensive services to ensure the successful completion of the transaction. This accomplishment highlights the commitment of the cross-border team to providing exceptional guidance, drawing from their extensive global sector knowledge and market expertise.

The joint venture company is scheduled to begin tyre manufacturing at its plant in 2026, with a projected annual production capacity of 3.5 million tyres. These tyres will include high-quality products for passenger vehicles under the Pirelli brand, as well as a newly introduced local brand tailored for the domestic and regional markets.

Senior legal consultant, Abdulrahman Alajlan, underlined the pivotal role played by their diverse team in ensuring the deal's success. Their contribution supports PIF's ongoing expansion efforts in the Kingdom, marking a significant milestone in this endeavour.

The cross-border team was composed of Karim Nassar (Riyadh), Phelim O'Doherty (London), Yousef Bugaighis (Dubai), Alessandra Calabrese (Milan), Pietro Bernasconi (Milan), Lorenzo de Martinis (Milan), Sue McLean (London), Lorenza Mosna (Milan), James Parker, and Jessica Steele (London).