Tadawul Group’s Wamid signs MoU to buy 51% in Direct FN for SAR 140.3 mln

Logo of Tadawul Advanced Solutions Co. (Wamid)

Saudi Tadawul Group Holding Co.’s (Tadawul Group) subsidiary, Tadawul Advanced Solutions Co. (Wamid), entered into a non-binding preliminary agreement today, Aug. 16, with Direct Financial Network Co. LLC (Direct FN) and its indirect majority shareholder, National Technology Group (NTG). Wamid will begin the due diligence process and negotiate the definitive agreements on the potential acquisition of a 51% stake in Direct FN.

Under the deal, parties agreed, on a non-binding basis, that the acquisition value is SAR 140.3 million. The final price is subject to adjustment based on the results of the due diligence process and the terms of the definitive agreements, the group said in a statement to Tadawul.

Wamid, Direct FN and NTG agreed to negotiate the definitive agreements with respect to the potential transaction, which will set out the relevant commercial terms customary in similar deals. The deal also includes other relevant provisions that regulate confidentiality, exclusivity, costs and other related matters.

Wamid appointed GIB Capital as financial advisor for the proposed acquisition. The contract shall terminate automatically if the share purchase agreement (SPA) is not executed within five months from the signing date, unless extended under a mutual agreement with Wamid, Direct FN and NTG.

Today's signing does not bind either party to proceed with the transaction. Therefore, there is no guarantee that the agreement and due diligence process will result in the deal's completion on a final and binding basis.

The three parties will endeavor to negotiate in order to sign the definitive agreements as soon as possible, following the satisfaction of certain procedures and conditions. In all circumstances, closing will be conditional on a number of terms, including obtaining the necessary regulatory approvals.

Tadawul Group added that there are no related parties to the agreement, noting any material developments will be announced in due course as required by the relevant rules and regulations.

For More Mergers and Acquisitions