(Bloomberg) -- Taiba Investment Co. and Dur Hospitality Co. are in talks to combine their businesses, potentially forming a company with a total market value of about $2.4 billion in Saudi Arabia’s hospitality and investment industry.

The discussions are preliminary and may not lead to a combination, according to regulatory statements. The companies didn’t provide further information.

Taiba, which has a market capitalization of 5.5 billion riyals ($1.5 billion), operates as an investment company in sectors ranging from real estate and tourism. Dur, valued at 3.5 billion riyals, is mainly focused on operating resorts, housing compounds, and restaurants in Saudi Arabia.

Both Taiba and Dur count the Public Investment Fund, the sovereign wealth fund of Saudi Arabia, as a shareholder, according to Bloomberg data. Assilah Investment is their top shareholder.

Saudi Arabian companies are at the forefront of M&A activity in the Gulf with combinations in the banking and insurance industries. Last year, National Commercial Bank agreed to buy rival Samba Financial Group for $15 billion in the biggest banking takeover of 2020.

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