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Saudi Arabia’s Power and Water Utility Co. for Jubail and Yanbu hired HSBC Holdings Plc and Riyad Capital to manage its initial public offering, according to people familiar with the matter, as the kingdom’s ambitious privatization program gathers pace. 

The company is seeking to raise as much as $1.2 billion by selling a 30% stake in the second half of the year, the people said, asking not to be identified because the information is private. Its shareholders include the Public Investment Fund, Saudi Arabian Oil Co. and Saudi Basic Industries Corp.

The utility, known as Marafiq, first floated the idea of an IPO in 2017 and hired GIB Capital to advise on the potential listing and power-plant acquisitions. The most recent attempt comes as the kingdom offloads stakes in state assets, including Saudi Aramco, to diversify its oil-dominated economy. The government has also sold stakes in the stock exchange and flour mills.

Representatives for Marafiq, HSBC and Riyad Capital didn’t immediately respond to requests for comment.

Marafiq is the main power provider for the industrial cities of Jubail and Yanbu, according to its website. It supplies energy for oil and petrochemical facilities owned by companies including Aramco and Sabic.

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