Alleged corruption puts Fawaz Alhokair Group’s mall unit sale in jeopardy

Fawaz Alhokair Group’s mall unit sale has been put on hold yet again after the group’s co-founder’s accounts were frozen in Saudi Arabia’s corruption crackdown.

According to people with knowledge of the matter cited by the Middle east edition of ‘Business week’, Fawaz Alhokair, who’s a major shareholder in the group and in fashion retailer Fawaz Abdulaziz Alhokair & Co., is being detained at the Ritz Carlton as part of the investigations.

Before the probe, the group had planned to restart work on the IPO of its Arabian Centres mall unit, the people said.

“There are many rumours in the market,” Fawaz Alhokair’s personal assistant said by email to the financial magazine, answering the questions on the arrest and the IPO. “Your speculations are false,” and “all is well and it is business as usual at our group.”

In February 2015, the group was close to hiring banks including Morgan Stanley and Bank of America Corp. to manage the Arabian Centres IPO.

Back then, market experts estimated the sale of a 30 percent stake in the company could have raised about 2 billion dollars.

Fawaz Abdulaziz Alhokair & Co. is the franchise partner for Gap, Banana Republic and Steve Madden in the kingdom, according to its website. Its Arabian Centres mall unit owns 19 shopping centres in Saudi Arabia.