Alujain requests NATPET’s justification on setting up 4 companies, selling stakes

Alujain Holding said in a bourse statement that its subsidiary, National Petrochemical Industrial Co. (NATPET), has set up 4 limited liability companies (LLCs), Fawasil Advanced Petrochemical Co., Afaaq Professional Chemicals Co., Menna Co. and Abraaj Al Taj for Plastic Industries Co.

 On Thursday, March 5, 2020, the ownership structure showed that Menna owns a 7.67% stake of Alujain Holding. The historical data of the major shareholders indicated that NATPET’s ownership dropped from 10.71% to 5.65% on March 2, 2020, then data on this ownership was omitted on March 3.

According to Alujain, NATPET owned 100% of these four companies, and recently sold 100% of Menna and 74% of its ownership in Fawasil, Afaaq and Abraaj.

Setting up these companies and the stake sale took a very brief period.

The value of Alujain’s share in the sold assets exceeds 10% of its net assets. As Alujain owns a 57.4% in NATPET and that NATPET’s practices weigh on Alujain’s shareholders, Alujain requested NATPET to submit a justification for these practices in addition to a detailed statement on the relevant financial impact.

These subsidiaries’ buying shares in Alujain is considered a violation of Article 184 of the Corporate Law, according to Alujain.

Alujain asserted that this material info will likely impact the stock’s price.

Earlier today, Alujain requested suspending its shares on Tadawul ahead of announcing material information.