Bawan Company announces the signing of its subsidiary (Bawan Engineering Industries Company or “Bawan Engineering”) an agreement to purchase additional shares in both United Transformers Electric Company and United Technology of Electric Substations & Switchgears Company for a total value of (20,000,000) Saudi riyals
| Element List | Explanation |
|---|---|
| Introduction | Bawan Company announces that its subsidiary, Bawan Engineering Industries Company, has signed an agreement to purchase the entire ownership shares of Maali Holding Company in United Transformers Electric Company and United Technology of Electric Substations & Switchgears Company (“the two companies”) for a total value of (20,000,000) Saudi riyals |
| Transaction Details | The purchase by Bawan Engineering, the entire shares of Maali Holding Company in the two companies, which represents 4.5% of the total ownership shares in each of the two companies, including its assets and liabilities, for a total value of (20,000,000) twenty million Saudi riyals. Therefore, Bawan Engineering ownership in the two companies reaches 90%.
The parties agreed that the shares would be sold based on the balances of the two companies’ audited financial statements as of 12/31/2023 AD, and that the approved effective date for the purchase transaction for accounting purposes would be 01/01/2024 AD.
The full purchase price will be paid after the General Assembly of Bawan Company approves the purchase transaction and after the completion of the transfer of ownership of all shares to Bawan Engineering. |
| Transaction Value | 20000000 |
| Transaction Terms | • The seller sold the shares to the buyer, and the buyer accepted to buy the shares including its assets and liabilities.
• The parties obtaining the necessary legal approvals. |
| Parties of the Transaction | 1- Bawan Engineering Industries Company
2- Maali Holding Company |
| Transaction Funding Method | From the company's internal resources |
| Transaction Execution Date | 2024-02-11 Corresponding to 1445-08-01 |
| Description of the Business of the Asset forming the Subject Matter of the Transaction | The two companies operate in the electrical industries sector.
For more details about the activities of the two companies, you can refer to the latest board of directors report available on the Bawan Company page on the Tadawul website. |
| Financial Statements for the Last Three Years of the Asset forming the Subject Matter of the Transaction | The combined revenues and profits of the two companies in the last three years amounted to the following:
1- FY Year 2021: Revenues: 448.9 million Saudi riyals. Profits: 1.1 million Saudi riyals.
2- FY Year 2022: Revenues: 608.6 million Saudi riyals. Profits: 26.2 million Saudi riyals.
3- The 9 months of FY 2023: Revenues: 533.8 million Saudi riyals. Profits: 48.5 million Saudi riyals. |
| Transaction reasons | The electrical industries sector in Bawan Company is considered to have a fundamental impact on its strategic plans and future expansions. Therefore, increasing the ownership of Bawan Engineering shares in the two companies will have a positive impact that will maximize the returns of shareholders in Bawan Company, God willing. |
| Expected Impact of the Transaction on the Company and Its Operations | It is expected that the positive impact of the deal on Bawan Company’s results will appear from the beginning of 2024. |
| Related Parties | Mr. Abdullah bin Abdul Latif Al-Fozan – Chairman of the Board of Directors of Bawan Co. |
| Additional Information | It is worth noting that Bawan Company owns all shares of Bawan Engineering Industries Company. |
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