Saudi Telecom Company (stc) announces that its subsidiary (Telecommunications Towers Company -TAWAL), signed a sale and purchase agreement (SPA) to acquire 3 towers companies.
| Element List | Explanation |
|---|---|
| Introduction | Saudi Telecom Company (stc) announces that its subsidiary (Telecommunications Towers Company -TAWAL), signed a sale and purchase agreement (SPA) on 20-04-2023 to acquire 3 towers companies from United Group in Bulgaria, Croatia and Slovenia countries for a cash consideration for the entire transaction. The transaction will be based on 100% Enterprise Value amounting to EURO 1.220 billion which equals approximately SAR 5 billion. It was agreed that the transaction cash consideration will be based on the agreed terms of the SPA in relation to debt, cash, and working capital. |
| Transaction Details | stc by its subsidiary TAWAL (through its subsidiary TAWAL International Holding company, 100% owned by TAWAL) signed a sale and purchase agreement (SPA) on 20-04-2023 to acquire 3 towers companies in Bulgaria, Croatia and Slovenia countries from United Group for a cash consideration for the entire transaction. The transaction will be based on 100% Enterprise Value amounting to EURO 1.220 billion which equals approximately SAR 5 billion. It was agreed that the transaction cash consideration will be based on the agreed terms of the SPA in relation to debt, cash, and working capital.
Through this transaction, TAWAL will acquire a total of 6,875 telecommunications site across the 3 countries where 4,821 existing sites and a plan to rollout 2,054 new sites.
Acquisition subject to regulatory approvals in Bulgaria, Croatia and Slovenia countries. |
| Transaction Value | EURO 1.220 billion which equals approximately SAR 5 billion. |
| Transaction Terms | 20-year master services agreement securing United Group with long term leasing services from TAWAL, including a plan to rollout 2,054 new sites. |
| Parties of the Transaction | TAWAL and United Group through their subsidiaries. |
| Transaction Funding Method | The transaction will be funded through bank loans. |
| Transaction Execution Date | 2023-04-20 Corresponding to 1444-09-29 |
| Description of the Business of the Asset forming the Subject Matter of the Transaction | Telecommunications towers, rooftops and other passive infrastructure sites acquired on closing with a master services agreement securing United Group with long term leasing services on those same sites for a minimum duration of 20 years from TAWAL. |
| Financial Statements for the Last Three Years of the Asset forming the Subject Matter of the Transaction | The towers’ assets have been recently carved-out from United Group in each of Bulgaria, Croatia and Slovenia countries, therefore no historical financial statements exist. |
| Transaction reasons | To support TAWAL’s expansion plans in the infrastructure sector, through entering into international markets. |
| Expected Impact of the Transaction on the Company and Its Operations | Adding 3 new countries to TAWAL’s international footprint, in addition to existing operations in Pakistan.
The financial impact will be positive as TAWAL will buy the entire shareholding in the 3 entities which will become 100% owned subsidiaries, accordingly the financial results will be consolidated into TAWAL’s financial statements and later in stc’s financial statements upon completion of the transaction. |
| Related Parties | NA |
| Additional Information | The sale and purchase agreement -SPA- is subject to a number of pre-closing conditions, including - but not limited to - obtaining the approval from the relevant authorities in Bulgaria, Croatia and Slovenia, as well as other regulatory and commercial conditions.
Any material developments will be announced in due course. |
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