Riyadh February 7 2024: Savola Group has announced plans to distribute its entire stake in Almarai to its shareholders, aiming to increase shareholder value, according to company filing to the Tadawul.
This move follows the recommendation by Savola's Board to boost its capital through a Rights Issue of SAR 6.0 billion. The Rights Issue will enable Savola to fortify its financial position, invest in its portfolio's growth, and reduce its debt.
After the Rights Issue, Savola intends to allocate its complete 34.52% ownership in Almarai, a prominent food and beverage company in the Middle East, to its shareholders. This initiative is designed to unlock value for Savola's shareholders, providing them with direct exposure to Almarai's growth potential and future dividend capacity. Almarai has proven to be one of Savola Group's most successful investments thus far.
Eligibility for the Rights Issue will be determined for shareholders who possess shares on the day of the Extraordinary General Assembly Meeting (EGM) endorsing the Capital Increase through Rights Issue. The EGM date will be disclosed later, following regulatory approval.
The objective of distributing Almarai shares is to enhance shareholder value by granting them access to the promising growth prospects and dividend potential of Almarai, a leading food company in the region. Savola's retail segment leader in Saudi Arabia, Panda, has witnessed a significant recovery in profitability due to a successful Customer Experience (CXR) program. Panda's future growth strategy revolves around maintaining this positive momentum by expanding its presence and enhancing digital initiatives. Savola is considering listing Panda in the future to further create shareholder value.
Savola's long-term strategic focus is on growing and optimizing its portfolio of operating businesses in basic foods and rapidly growing value-added food categories. This strategy is supported by its extensive track record and broad reach within the Kingdom and the wider MENA region.
It's important to note that the planned Rights Issue will be followed by a capital reduction (pending regulatory and EGM approvals), necessary to facilitate the distribution of Almarai shares.
Savola's issued capital currently stands at SAR 5,339,806,840, divided into 533,980,684 ordinary shares. Any significant developments related to this matter will be announced by Savola Group in accordance with the regulations of the Capital Market Authority and the rules of the Saudi Exchange (Tadawul).