BinDawood Holding's expansion plans, ops unhurt by Commercial Growth Development exit: CEO

Ahmad BinDawood, CEO of BinDawood Holding

The exit of Commercial Growth Development Co., an associate of Bahrain’s Investcorp, from BinDawood Holding Co. through the sale of its 5.6% stake in the latter is unlikely to take a toll on BinDawood Holding's operations and future expansion plans, CEO Ahmad BinDawood exclusively told Argaam.

The exit is part of Commercial Expansion Development's strategic plan, said the CEO, adding that the stake was sold to a limited number of institutional investors through its full distribution and not via the direct market, meaning BinDawood Holding's stock will not endure random sales operations.

Since 2016, Commercial Expansion Development has been a major investor in BinDawood Holding. The stake sale decision was already entailed in the investment plan that included purchasing a stake in the latter ahead of its market listing in 2020, with more investments being pumped until 2024, according to BinDawood.

He indicated that the ultimate goal of such financial companies typically sees their entry into intercorporate investments for specific periods before exiting at the right time when the company invested in matures to a certain extent.

The top executive also confirmed that the selling price was determined as per the negotiation policy between Commercial Expansion Development and the related parties. A slight discount is expected given the deal’s significant size, which is only normal and aligns with Tadawul’s and the Capital Market Authority’s (CMA) regulations.

BinDawood also said the move bodes well for his company. This is because it will contribute to boosting the investor base and expanding offerings to shareholders.

The exit is unlikely to affect BinDawood Holding's expansion plans, as it continues to seek opportunities available in the market. The company also continues to work on attracting new local and international investors, according to the CEO. He noted that the stock split decision is aimed at expanding the shareholder base.

BinDawood Holding boasts strong liquidity and a debt-free solid financial position, said the top executive, adding that profitability has picked up over the past two years, despite the challenges that the company had faced due to the COVID pandemic. He expected the company to post positive results by the end of this year, thanks to the robust performance in the first and second quarters.

The CEO also indicated that BinDawood Holding is proceeding with its expansion plans. Several acquisitions have already been finalized, enabling capitalizing on its integrated diversification, given expansions by International Applications and Icon.

Moreover, BinDawood Holding plans to expand into financing solutions, as part of its future strategy. This is by seeking partnerships with fintech players and expanding the provision of products and solutions that further benefit customers, especially after the great success of its loyalty program, which allows customers to leverage the exclusive advantages it offers them.

He added that the company intends to expand into integrated retail in fields such as pharmacy and personal care, and to further grow by acquiring local brands through the distribution company acquired earlier this year.