Arab Sea signs SAR 52.5 mln SPA to buy property in Riyadh in return for 4.4% stake in capital

Logo of Arab Sea Information Systems Co.

Arab Sea Information Systems Co. signed today, Sept. 4, a sale and purchase agreement (SPA) worth SAR 52.5 million, including real estate tax, to acquire a real estate asset in Riyadh.

The property is owned by board chairman Mohammed Al-Suhaibani by increasing capital through the acquisition of the real estate asset in return for the issuance of shares to Al-Suhaibani, according to a bourse filing.

The company noted that all parties agreed that the issue price will be SAR 120 per share.

The 23-floor building is located in Al-Sahafa District, north of Riyadh.

After the completion of the acquisition process, the ownership percentage of the existing shareholders will decrease from 85.999% to 82.394%, which will affect their voting rights.

The expiry date of the agreement is when the preconditions in the real estate sale and purchase agreement are fulfilled, which must be at or before 365 days after the effective date (the date of signing the real estate sale and purchase agreement), the company noted.

The acquisition transaction involves the presence of related parties from board members, as Chairman Mohammed bin Saleh Al-Suhaibani has an interest in the acquisition deal, given that he is the company's chairman and the property is wholly owned by him, as well as the company’s CEO and board member Haitham bin Mohammed Al-Suhaibani, who is the seller's son. All related parties will abstain from voting on the decision to acquire the real estate asset.

Both parties have the right to terminate the agreement before its expiration in the case of violation by either party of its obligations without correcting the violation within 30 days from the date on which it was notified by the other party that the violation must be corrected; the information and documents mentioned in the agreement are incorrect and lawsuit or an ongoing investigation by any government agency, or change in existing legislation, or any measure that prevents the implementation of the agreement or makes it illegal.

Required approvals include the following obtaining the approvals of the Capital Market Authority (CMA) regarding the acquisition transaction and circulating to shareholders; the Saudi Exchange (Tadawul) for the listing of the new shares resulting from the capital increase, the company's extraordinary general assembly, in accordance with the provisions of the Companies Law and the rules for offering securities and continuing commitments, in connection with the acquisition deal from the Ministry of Commerce and any other necessary approvals related to the acquisition transaction.