Emaar EC reschedules SAR 3.39B bank facilities

Logo of Emaar The Economic City (Emaar EC) 

Emaar The Economic City (Emaar EC) signed agreements on April 27 to reschedule existing bank facilities and secure new financing arrangements, the company said in a statement to Tadawul.

For more news on listed companies

The agreements were signed with Alinma Bank, Saudi Awwal Bank (SAB), Banque Saudi Fransi (BSF), and Saudi National Bank (SNB).

The deals cover the rescheduling of SAR 3.39 billion worth of facilities, divided into tranche A and tranche B, reflecting differences in maturity extension options, interest rates, and the capitalization of tranche B.

Under the terms of the rescheduling, the banks also committed to providing a new SAR 287.3 million facility, which will support the broader restructuring effort.

The previous financing terms set the maturity dates at July 9, 2028, and May 24, 2026, for the Alinma Bank facilities; Nov. 30, 2022, and Dec. 15, 2029, for the SAB facilities; Oct. 31, 2029, for BSF; and Aug. 31, 2021, for SNB.

Under the new terms, the rescheduled financing will mature on Dec. 31, 2033, with annual repayment installments beginning on Dec. 31, 2029. The maturity of tranche B may be extended further to Dec. 31, 2036, subject to agreement between the company and the lenders.

The new SAR 287.3 million facility will be repaid in a single bullet payment on June 30, 2026, with an option to extend the maturity by one year to June 30, 2027, provided that certain conditions are met.

The security provided by the company consists of real estate mortgages with collateral coverage of at least 150% for the rescheduling and 175% (for the new facility) of the outstanding principal amount.

The guarantees also include a security over accounts as well as principal and commission promissory notes.

The purpose of this overall rescheduling is to reschedule the financial indebtedness of the company and unify the terms. This rescheduling comes as part of the company’s announced Capital Optimization Plan, designed to stabilize financial and operational positions and optimize capital structure to enhance its ability to move forward with its growth plans.

Furthermore, Emaar EC aims to enhance its liquidity position during the anticipated period of revived business and operational growth in line with its recently approved strategy and to optimize its financing costs throughout the rescheduling period and revised terms of the loan, the statement added.

Meanwhile, the company noted that SNB is a related party pursuant to the rules of the Capital Market Authority (CMA), given that it is controlled by a major shareholder of the company, the Public Investment Fund (PIF).

According to data available on Argaam, Emaar EC announced in September 2024 its financial restructuring plan aimed at boosting its ability to move forward with its growth plan.

The plan includes bank facilities rescheduling, as the company signed a non-binding term sheet on Sept. 7 to roll over its existing facilities with Alinma Bank, Saudi Awwal Bank (SAB), Banque Saudi Fransi (BSF), and Saudi National Bank (SNB).