Tihama finalizes acquisition of 35% stake in Integrated Production for SAR 7.25 mln

Tihama Advertising Public Relations and Marketing Co. completed on March 10, 2021, the procedures to acquire an additional 35% stake in Integrated Production Co. for Audiovisual Media Production at a total value of SAR 7.25 million, the company said in a bourse filing.

The acquisition deal, which has no special conditions, will be financed from the proceeds of the company’s capital increase.

The relevant financial impact is forecast to appear as of the fiscal year (FY) ending March 31, 2022.

Integrated Production reported approximately SAR 21 million in revenue for FY ending March 31, 2020, while net profit stood at SAR 2.1 million.

This acquisition echoes the company's expansionary strategy, especially in the light of the large and accelerating growth witnessed in the production sector, in line with the Vision 2030. It also underpins the company’s role in boosting local production, localizing the industry and maximizing the return on equity for the company's shareholders.

The deal is a related party transaction as Majal Al Soura and Integrated Production Corporation for Artistic Production are partners of Tihama in its subsidiary, Integrated Production Co. for Audiovisual Media Production.

Integrated Production is working to place Saudi content on the visual entertainment map through three sectors; production of high-quality content for TV programs, series and films; commercial advertising and digital production.

Integrated Production’s expansion plans include future opportunities that will contribute to diversifying and developing its revenue sources, which will reflect positively on the group's revenue and profit.

In February, Tihama signed an agreement to raise its ownership to 70% in the subsidiary, for SAR 7.25 million, according to data compiled by Argaam.

The company signed a memorandum of understanding (MoU) on Jan. 13, 2021, with Majal Al Soura for Communications and Information Technology Corporation and Integrated Production Corporation for Artistic Production to acquire an additional stake in Integrated Production Co., according to data available on Argaam.