Construction firm said to agree loan with local banks to ease its financial pressures, according to Reuters report
Crisis-hit Saudi Binladin Group has secured a SAR 2.5 billion ($667 million) loan to ease its financial pressures, according to a news report.
The builder, having been hit by government spending cuts and a slowdown in the local construction industry, has laid off tens of thousands of workers due to severe financial problems and amid widespread allegations of delayed salary payments.
In an attempt to ease the huge financial burden on it, Saudi Binladin Group has secured financing from local lenders, according to unnamed banking sources quoted by Reuters.
The loan is to be provided by Arab National Bank and Saudi British Bank, and will be used to cover redundancy payments, back salaries and severance costs, the news agency reported.
Saudi Binladin Group is said to be making as many as 77,000 workers redundant, according to local press reports.
The group was banned from bidding for new government contracts after a crane collapsed last September at one of its sites in Mecca, Saudi Arabia, killing 107 people. That ban was reportedly lifted a few weeks ago.
Funding issues surrounding Saudi Binladin Group were recently cited as it emerged that the 1km-high Jeddah Tower in Saudi Arabia, on which the group is working, has been delayed by one year.