RIYADH, May 14 (Reuters) - The company behind Saudi

Arabia's vast Qiddiya sports and entertainment complex near

Riyadh will take over entertainment business SEVEN, in a bid to

expedite the multi-billion dollar project, sources told Reuters

on Tuesday.

The acquisition aims to "capitalise on business synergies

between the two companies," according to a statement on Saudi

state news agency.

But a source, who declined to be identified due to the

sensitivity of the issue, said the move was designed to ensure

that Qiddiya's top projects, including a massive sports stadium

that should be ready for the World Cup 2034, are finished on

time.

Saudi Arabia's highly ambitious efforts to develop its

entertainment and tourism industry have faced significant

delays, leaving Qiddiya years behind schedule.

Crown Prince Mohammed bin Salman, chairman of Saudi Arabia's

$700 billion sovereign wealth fund, is banking on entertainment

projects such as Qiddiya to transform the kingdom and diversify

its economy away from oil under his Vision 2030 program.

Qiddiya was among the first of the so-called giga-projects

announced in 2018 and was scheduled to open in 2022 and attract

1.5 million visitors. The first theme parks, Six Flags and Aqua

Arabia, are now expected to open in 2025.

The deal follows decisions by the Saudi government to

prioritise some developments over others, as the economy

grapples with a looming 79 billion riyal ($21.06 billion)

deficit.

"There are challenges... we will change course, we will

adjust, we will extend some of the projects, we will downscale

some of the projects, we will accelerate some of the projects,"

Saudi Arabia' Finance Minister Mohammed Al Jadaan told the World

Economic Forum meeting in Riyadh in April.

The company did not respond to Reuters' questions on whether

the acquisition was related to project delays.

The Public Investment Fund (PIF) owns Qiddiya Investment

Company and was the owner of Saudi Entertainment Ventures, or

SEVEN, before Tuesday's move. SEVEN will remain under the

umbrella of PIF, which has funded many of the futuristic

projects, the statement said.

The sovereign wealth fund has made a landmark deal to

reshape the world of golf, bought a $3.6 billion aircraft

leasing business from Standard Chartered ( SCBFF ), built up a 10% stake

in Spain's Telefonica and launched an ambitious 300 million euro

($323.58 million) bid for the services of French soccer

superstar Kylian Mbappé, to name a few.

The Crown Prince's plan to wean the $1.11 trillion Saudi

economy off oil is now hitting stumbling blocks.

The flagship Line, "city of the future" held between two

mirrored walls in the new economic zone of NEOM, has faced

setbacks, while Qiddiya has suffered delays and frequent changes

in management.

Branded the 'city of play', Qiddiya will feature a Six Flags

theme park, a Dragon Ball-Z Park, an E-Sports arena, several new

hotels, resorts and a new Formula One track snaking through the

complex.

"It's too late, it was supposed to start yesterday", said a

source with knowledge of the project, explaining that the

acquisition is designed to bring Qiddiya back on track.

($1 = 3.7503 riyals)

($1 = 0.9271 euros)