MEPCO to acquire Al-Medan Project for SAR 91M, issue new shares

The deal includes purchasing 1,000 ordinary shares, representing the entire capital of MPCCC, for SAR 91 million. As part of the transaction, MEPCO will issue new shares to the sellers.

In a statement to Tadawul, MEPCO said the sellers are Najlaa Alotaibi, Najud Alotaibi, Alwaleed Alotaibi, Amjad Alotaibi, Abdulmajeed Alotaibi, and Mohammed Alotaibi. The newly issued shares will be allocated to the sellers before the acquisition is finalized, based on the volume-weighted average price of MEPCO shares.

The company noted that while the ownership percentage of existing MEPCO shareholders will decline once the acquisition is completed, the total number of shares they hold will remain unchanged. It also said the risk factors related to the transaction will be detailed in the shareholders’ circular, which will be published after securing regulatory approvals.

The agreement includes standard fundamental warranties from both parties, along with business and tax warranties provided by the sellers. The sellers will be subject to a 12-month lock-up period starting from the completion date of the deal. Further details about the lock-up period and other terms will be disclosed in the shareholders’ circular.

MEPCO appointed SNB Capital as its financial advisor and Baker McKenzie as its legal advisor for the acquisition. The company confirmed that any significant developments regarding the transaction will be announced in due course.

MEPCO has the right to terminate the agreement by written notice if the preconditions for completing the acquisition are not met within nine months of signing. Upon completion, the sellers must provide proof that all preconditions have been fulfilled to MEPCO’s satisfaction and comply with their obligations to finalize the transaction.

If the sellers fail to meet these requirements, MEPCO will not be obligated to proceed with the acquisition, pay the cash consideration, or allocate the new shares. MEPCO has the discretion to either postpone the completion date, waive certain conditions and proceed with the transaction, or terminate the agreement without liability.

The acquisition remains subject to several conditions, including regulatory approvals from the Capital Market Authority, the Saudi Exchange, and the General Authority for Competition. It also requires approval from MEPCO’s extraordinary general assembly and authorization from the Ministry of Commerce or the Saudi Business Center to amend MPCCC's Articles of Association.

The deal will only proceed if no regulatory authority in Saudi Arabia issues a decision preventing the transaction.