(Bloomberg) -- Saudi Arabia’s sovereign wealth fund delayed the potential sale of its remaining stake in a local utility firm after lackluster demand from investors, according to people familiar with the matter.

The Public Investment Fund in recent weeks held informal talks about raising as much as $800 million from a share placement of its 17.5% stake in Power and Water Utility Co. for Jubail and Yanbu — known as Marafiq, the people said, asking not to be identified as the information isn’t public. 

A resurgence in initial public offerings in the kingdom over the past couple of months has diverted investor attention away from Marafiq’s placement, the people said. The poor performance of the most recent follow-on sales has also made the PIF more cautious about future deals, they said. 

Shares in Marafiq fell as much as 2.3% on Monday, the biggest drop since Sept. 18.

The fund may revisit the idea of selling some of its Marafiq stake at a later date, the people said. The PIF declined to comment on the deal while Marafiq didn’t respond to requests for comment.

The PIF, which holds stakes in some of Saudi Arabia’s biggest companies such as Saudi Electricity Co., Saudi Arabian Mining Co. Saudi National Bank and Riyad Bank, is reducing its holdings to raise funds for overseas deals and investments to help diversify the kingdom’s economy away from oil. 

The fund plans to invest $40 billion locally a year until 2025 and is bankrolling ambitious projects such as Neom — a $500 billion city intended to attract new industries.

Read more: Saudi Wealth Fund Said to Ready Billions in Domestic Stock Sales

In the past month alone, entities in the kingdom have raised $2.2 billion from listings, effectively more than doubling Saudi Arabia’s IPO haul for the year.

While the fund has already successfully sold stakes in some of its companies via IPOs — such as the $1 billion listing of exchange operator Saudi Tadawul Group Holding and the $1.2 billion float of utility ACWA Power International — there have been few follow-on offerings in listed firms.

In November, the PIF raised 2.29 billion riyals ($610 million) from the sale of a 10% stake in the kingdom’s stock exchange, which it had listed the year before. Shares plunged well below the sale price and investors who bought into the share sale were sitting on a loss of 28% about a month after the deal. The stock only recovered in June when it eventually rose above the sale price of 191 riyals.

Marafiq’s IPO raised $897 million last November after drawing $53 billion in orders. However, the shares gave up most of their gains on debut and languished around the listing price for a few months. The stock peaked at 89.80 riyals in July.

(Updates with share move in 4th paragraph)

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