Saudi construction firm highlights financial challenges

Saudi construction firm Mohammad Al-Mojil Group (MMG) said it has written directly to Deputy Crown Prince Mohammed bin Salman explaining that it may not be able to continue operating. It was unclear if the privately owned company was seeking financial or other assistance from the government.
In a short statement via the stock exchange on Monday, MMG said its letter to the deputy crown prince prince also addressed constraints imposed by banks and the government, and legal restrictions that were blocking company leaders from speaking publicly about proposed solutions to its problems. It did not elaborate.
MMG is trying to restructure after running into trouble amid wider turmoil in the Saudi construction industry.
MMG said in its letter that “serious financial losses led to doubts over the company’s ability to continue,” according to the statement.
The deputy crown prince chairs Saudi Arabia’s Council of Economic and Development Affairs, which is responsible for overseeing Saudi Vision.
MMG’s shares have not traded on the Saudi bourse since July 2012, when the Capital Market Authority (CMA) suspended the stock over losses incurred as the company overextended itself trying to take advantage of a construction boom in the Kingdom.
Since then, the company has been trying to restructure itself, partly by seeking payment of hundreds of millions of riyals it says it is owed for completed work. It has slashed its workforce to 3,000, from 25,000.

Source: Arab News