MBC Group sells 2.45M shares in Al Arabia

Logo of MBC Group Co.

MBC Group sold today, Oct. 20, part of its stake in Arabian Contracting Services Co. (Al Arabia), comprising 2.45 million shares, or 4.9% of Al Arabia's share capital, to several investors.

In a statement to Tadawul, the company said the transaction, worth about SAR 416.5 million, was executed via negotiated deals in accordance with the applicable procedures.

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The book value of Al Arabia's entire capital is around SAR 1 billion, while the book value of the shares sold in the transaction amounted to nearly SAR 246 million.

The transaction is aimed at strengthening the company's financial position and realizing a portion of its investment profits.

The transaction is expected to have a positive impact on the company's consolidated financial statements in FY ending December 31, 2024. The transaction proceeds will be used to support the company's activities, according to the statement.

After the sale deal, MBC Group will retain a 15.1% stake in Al Arabia as an investment in an associated company. The remaining shares held by the company in Al Arabia will be subject to a 180-day contractual lock-up undertaking, starting from the transaction execution date.

As many as 104 negotiated deals were executed today on Al Arabia stock, with about 2.45 million shares traded, or 4.9% of the company's 50 million share capital, at a total value of about SAR 416.5 million, data available to Argaam showed.

MBC Group announced today the full repayment of a SAR 497.25 million loan owed to Istedamah Holding Co., pursuant to the loan agreement dated Oct. 6, 2022, and amended on July 6, 2023, as disclosed in the prospectus.

According to data available data on Argaam, a loan agreement for SAR 497.25 million was previously signed in order to acquire 15% of Al Arabia.

Under the agreement, MBC Group must settle the loan within 12 months from the date of receipt of the request for payment from Istedamah Holding Co.; the date of the company's waiver of its shares in Al Arabia; or any other date determined by Istedamah under a written notification.

MBC Group owns a 20% stake in Al Arabia.