Elm Co. Acquires Thiqah: A Strategic Move to Boost Saudi’s ICT Sector Under Vision 2030

The acquisition of Thiqah Business Services Co. by Elm Co. marks a significant step in Saudi Arabia’s push to modernize its technology sector and consolidate national champions under Vision 2030. For $907 million, Elm has secured full control of a digital solutions provider with deep ties to the Saudi public sector, signaling a broader strategy to streamline operations, cut costs, and position itself as a leader in smart services. But behind the transaction’s headline numbers lies a complex web of related-party interests, regulatory approvals, and the evolving calculus of Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF).

The deal, finalized in January 2025, sees Elm purchasing PIF’s 100% stake in Thiqah—a move that aligns with PIF’s stated goal of divesting non-core assets while nurturing companies that can drive economic diversification. Thiqah, which generated SAR 1.6 billion ($429 million) in revenue in 2023, specializes in digital transformation for public institutions, a field where Elm—a larger player with SAR 5.3 billion ($1.4 billion) in 2024 revenue—is already entrenched. Together, the combined entity will command a market presence of SAR 6.9 billion, a scale that could unlock economies of scale and cross-selling opportunities.

Yet the transaction is not without complications. As a related-party deal—PIF holds a substantial stake in Elm and two Elm board members have indirect interests—the agreement required special scrutiny. Approval came only after a vote by Elm’s ordinary general assembly on March 17, 2025, underscoring the need for transparency in a market still building investor confidence.

The strategic rationale is clear: Elm CEO Mohammed Abdulaziz Al Omair emphasized the “enhanced capabilities” to serve clients, while PIF’s Shahd Attar framed the deal as a step toward Vision 2030’s ICT goals, such as localizing technology and boosting sectoral efficiency. But the financial implications are equally critical. Elm’s Q2 2025 financials will reflect the acquisition’s full impact, including how the SAR 3.4 billion purchase price—a figure that excludes transaction costs—will affect debt levels and free cash flow.

Investors will watch closely for signs of synergies. Thiqah’s expertise in government IT systems could complement Elm’s existing strengths in telecom and cybersecurity, creating a vertically integrated player capable of competing with global firms. However, the success hinges on execution: integrating two organizations in a sector as complex as ICT demands precise management.

The move also reflects PIF’s evolving portfolio strategy. Having poured capital into global ventures like Uber and Tesla, PIF is now focusing on domestic assets that align with Vision 2030’s push to create high-value jobs and reduce reliance on oil. By offloading its stake in Thiqah to Elm—a company already aligned with its strategic vision—PIF avoids the operational burden of managing a niche tech firm while still reaping the benefits of its growth.

For Saudi Arabia’s tech ecosystem, the deal is a milestone. The ICT sector contributed 3.7% to the kingdom’s GDP in 2023, a figure projected to rise as digital transformation accelerates. Elm’s acquisition of Thiqah positions it to capture a larger slice of this growth, particularly in areas like cloud computing and AI-driven services, which are critical to Vision 2030’s “Digital Transformation Program.”

In conclusion, Elm’s purchase of Thiqah is more than a corporate consolidation—it’s a strategic play to build a national champion capable of driving Saudi Arabia’s tech ambitions. With combined revenues exceeding SAR 6.9 billion, Elm now holds a commanding position to capitalize on government digitization projects and private-sector tech spending. While risks remain—most notably the execution of integration and debt management—the transaction’s alignment with Vision 2030’s priorities suggests long-term upside. For investors, this deal underscores a growing trend: Saudi Arabia’s tech sector is no longer an afterthought but a key frontier for both domestic and global capital.