Saudi Industrial Services Company (“SISCO”) announces that its Board of Directors has approved the acquisition of a 31.7% direct equity stake in Green Dome Investments LLC (“Green Dome”) through a share ownership transfer from its subsidiary Saudi Trade & Export Development Company (“LogiPoint”), a related party, for a total net consideration of SAR 44.5 million. The acquisition is subject to shareholder approval at SISCO’s Annual General Meeting (“AGM”). The date of the upcoming General Assembly Meeting will be announced in due course.

Transaction Details:

SISCO will acquire LogiPoint’s 31.7% direct equity stake in Green Dome through a share ownership transfer, at fair value, for a total consideration of SAR 44.5 million. As a 76%-owned subsidiary of SISCO, LogiPoint is a related party.

Transaction Value:

SAR 44.5 million.

Transaction Terms:

The acquisition is subject to approval by SISCO’s shareholders at its AGM. The date of the upcoming General Assembly Meeting will be announced in due course.

Parties of the Transaction:

Saudi Industrial Services Company (“SISCO”) – buyer

Saudi Trade & Export Development Company (“LogiPoint”) – seller

Green Dome Investments LLC (“Green Dome”) – target

Transaction Execution Date:

To be announced following General Assembly Approval.

Transaction funding method:

Cash

Description of the Business of the Asset forming the Subject Matter of the Transaction: Headquartered in Dubai, UAE, Green Dome is a logistics investment fund that invests in profitable, well-managed companies that have a demonstrable track record of success, with a focus on companies that will benefit from demand for integrated logistics in the wider GCC region.

On 25 November 2021 (20/04/1443), Green Dome acquired 100% of the share capital of Elite Logistics LLC (“Elite”), to which LogiPoint, as a 31.7% shareholder in Green Dome, made an initial capital contribution of SAR 58 million.

Following the completion of the acquisition, based on the financial strength and strong prospects of Elite, Green Dome was able to secure acquisition debt finance of SAR 42.5 million thus reducing the equity contribution required from Green Dome’s shareholders by SAR 42.5 million.

As a result, Green Dome reimbursed SAR 42.5 million, of which LogiPoint received SAR 13.5 million, representing its 31.7% shareholding in Green Dome.

This results in a net capital contribution paid by LogiPoint of SAR 44.5 million which is effectively the consideration SISCO will pay to LogiPoint to acquire 31.7% of Green Dome.

Financial Statements for the Last Three Years of the Asset forming the Subject Matter of the Transaction:

Not applicable.

Transaction reasons:

Green Dome's strategy is based on a buy-and-build model that creates economies of scale in the logistics services market. As such, its logistics solutions strategy is well-aligned to SISCO’s strategy for the logistics vertical in its portfolio, as it transitions to offer a more diverse range of logistics services to customers.

SISCO’s management and Board therefore believe that Green Dome will deliver synergies with SISCO and its portfolio and that there is a compelling rationale for the company to be integrated directly into the Group’s portfolio, where these synergies can be realised.

Meanwhile, SISCO’s subsidiary LogiPoint will continue to focus on expanding its presence and core offering across the Kingdom as a leading logistics real estate developer and operator.

The transaction is announced as SISCO continues to make good progress on the implementation of its recently updated five-year strategy for growth, which aims to leverage existing capabilities in its core segments to invest in assets with a significant opportunity to be scaled-up and accelerate the returns timeline for SISCO and its shareholders.

In addition to the above transaction, key milestones during the last twelve months, in support of delivering on the strategy, have included the part divestment of the Group’s direct equity stake in the Red Sea Gateway Terminal Company (“RSGT”); expansion by subsidiary LogiPoint; and important independent sewage water treatment plant contract awards in the water solutions segment.

Expected Impact of the Transaction on the Company and Its Operations:

The financial impact of the transaction will be realized in SISCO’s Q2 2022 financial statements, which will be disclosed to the market in due course. Green Dome will be equity accounted in SISCO’s financial statements.

Related Parties:

Saudi Trade & Export Development Company (“LogiPoint”) – Subsidiary