Saudi Cable buys cars on credit for SAR 200 mln to finance working capital

Logo of Saudi Cable Co.

Saudi Cable Co. purchased SAR 200 million worth of new cars on credit from Al-Nawasi General Trading & Contracting Company (NTC Co.) to resell them and finance working capital.

The purchase was completed according to the models and quantities listed in the contract and the related quotation. The purchase price will be repaid in annual installments over five years with an annual increase of 5% and it will be delivered within 25 business days from the date of signing the contract, the company said in a bourse statement.

The cars will be delivered in consideration of an advance payment of 12% of the total value, of which 3% is payable upon signing. Meanwhile, a half of the remaining 9% will be payable upon receiving half of the cars' value, while the rest is after receiving the remaining cars.

The contract is valid for 60 months, Saudi Cable added.

The company will use the cash flows generated from the resale of the assets to finance the working capital, which will result into enhance its operating activity by increasing working capital turnover.

Saudi Cable also noted that it will resell these assets within a short period, the statement concluded.