L'azurde is pleased to announce that on the evening of 5 August 2018, after completion of commercial, legal and financial due diligences, it has signed the Share Purchase Agreement (SPA) to acquire 100% equity stake in Izdiad Commercial Company of Arabia (hereinafter referred to as Izdiad), the sole-franchisee and operator of TOUS international franchise in KSA.

This represents a major development for the Company, establishing a strong presence in the affordable jewelry segment and adding a new source of growth and profitability. Izdiad has demonstrated continuous solid growth in revenues and profits since its inception, with its 2017 net income reaching SAR 18.8 million.

TOUS is an international lifestyle brand focused on affordable luxury that has been in business for almost 100 years and with more than 620 stores in over 53 countries. As a franchisor, TOUS designs, manufactures and sells jewelry, bags and accessories for women and men. Their offering covers a wide range of products including fine jewelry with diamond, gold and silver, its core business, and handbags, fragrances and accessories. TOUS has been present in KSA since 2008 with a network today of 22 stores across the Kingdom. Through the TOUS brand L'azurde will reinforce its jewelry portfolio and grow its customer base by diversifying revenues and complementing its assortment. The Company management is proud to partner with TOUS, a world leader in jewelry. This transaction represents a great strategic fit with the L'azurde Group vision to enter the affordable luxury jewelry segment, which provides solid margins and profits and it will help diversify the Company's portfolio addressing a totally new product offering.

The purchase price has been agreed based on an enterprise fair value of SAR 188 million and an earn-out payment of up to SAR 25 million subject to satisfaction of certain levels of net income for the 2020 financial year. Net income for Izdiad was recorded at SAR 18.8 million, SAR 19.1 million and SAR 16.1 million respectively for the past three years 2017, 2016 and 2015. The transaction is expected to be financed by bank credit facilities and cash equity financed by L'azurde operational activities. We also confirm that there are no related parties involved in this transaction.

Back on 26 September 2017, L'azurde had announced on Tadawul's website the signing of a Memorandum of Understanding (MoU) with Tamkeen Industrial & Trading Company (Tamkeen) to acquire 100% equity stake of Izdiad Commercial Company of Arabia, a limited liability company which is a subsidiary of Tamkeen and operating in the affordable luxury jewelry retail sector in the Kingdom.

On 30 May 2018, L'azurde announced the latest development related to the acquisition of the KSA franchisee for the global TOUS brand to expand in the affordable luxury jewelry global segment.

The results of Izdiad will be consolidated in L'azurde group's results once the full control has been transferred to L'azurde. The acquisition is subject to customary conditions and is expected to close no later than 31 October 2018. The SPA can be terminated by mutual consent of the parties, material adverse change in the business, or a breach of warranties.

Any development will be communicated later.