Savola Group Announces its Board’s Recommendation to Increase Capital by Rights Issue and to Distribute its Entire 34.52% Stake in Almarai to Savola’s Shareholders.
| Element List | Explanation |
|---|---|
| Introduction | Savola Group (‘Savola’) announces its Board’s recommendation to increase its Capital by SAR 6.0 billion through Rights Issue, which will allow Savola to strengthen its financial position and continue to invest in the growth of its portfolio, while paying down its debt. Following the Rights Issue, Savola intends to distribute its entire 34.52% shareholding in Almarai, the Middle East’s leading food and beverage company, to Savola’s shareholders, with the objective of unlocking value for its shareholders. |
| Date of Board Meeting | 2024-02-06 Corresponding to 1445-07-25 |
| Target Amount | SAR 6 billion |
| Reasons for the increase | The Rights Issue will allow Savola to strengthen its financial position and continue to invest in the growth of its portfolio, while paying down debt and enabling the distribution of the Almarai shares to Savola's shareholders. |
| Eligibility date | Eligibility of the Rights Issue shall be for shareholders who own the shares on the day of the Extraordinary General Assembly Meeting (“EGM”) that will approve the Capital Increase through Rights Issue, and whose names appear in the Company’s shareholder register at the Depository Center at the end of the second trading day following the date of the EGM. The EGM date will be announced later after securing the regulatory authorities’ approval. |
| Approvals | The Board’s recommendation is subject to the approval of the relevant regulatory authorities and Savola’s shareholders at the EGM. |
| Appointment of Financial Advisor and Submission of the Capital Increase Application File to CMA | The appointment of the financial advisor for the Rights Issue and submission of the Capital Increase application file to the CMA will be announced later. |
| Additional Information | In addition to the proposed capital increase through Rights Issue and in line with its objective to unlock value for shareholders, the Board has also recommended the distribution of Savola’s entire 34.52% shareholding in Almarai to Savola’s shareholders, subject to securing the necessary approvals from the relevant regulatory authorities and from the General Shareholders Assembly.
The Rights Issue will allow Savola to strengthen its financial position and continue to invest in the growth of its portfolio, while paying down debt and enabling the distribution of the Almarai shares to Savola’s shareholders.
The objective of the distribution of the Almarai shares owned by Savola is to unlock value for Savola’s shareholders, who will benefit from direct exposure to the growth potential and future dividend capacity of Almarai, one of the region’s leading food companies. Almarai has been one of the most successful investments for Savola Group to date.
Savola’s Saudi retail segment leader, Panda, has demonstrated healthy recovery in profitability, thanks to a successful Customer Experience (“CXR’”) program. Panda’s future growth strategy centers on sustaining this positive momentum by expanding its footprint and bolstering it with digital initiatives. Savola will consider a listing of Panda in the future, presenting an additional shareholder value creation opportunity.
Savola’s long-term strategic focus will be to continue to grow and optimize its portfolio of operating businesses in basic foods and fast-growing value-add food categories, underpinned by its longstanding track record and its vast reach within the Kingdom and wider MENA region.
It should be noted that the planned Rights Issue will be followed by a capital reduction (subject to regulatory and EGM approvals), which is required to enable the distribution of its shares in Almarai Co.
It is also worth mentioning that Savola's issued capital is SAR 5,339,806,840 divided into 533,980,684 ordinary shares.
Savola Group will announce any material developments pertaining to the subject once occurring in accordance with the Capital Market Authority’s regulations and the Saudi Exchange’s (Tadawul) rules.
For more information and details pertaining to the transaction, please refer to the following Savola weblink:
https://www.savola.com/en/right-issue-and-distribution/ |
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