Savola to acquire additional stake in Al Azizia Panda unit

Beirut :  Saudi Arabia's food producer Savola Group Company yesterday said it plans to acquire an additional 7 per cent stake in its unit Al Azizia Panda United Company from Fawaz Alhokair Group through a share swap.

Savola said in a statement posted on the Saudi bourse website the 7 per cent is Alhokair's entire stake in Al Azizia Panda and that it also plans to acquire the 18.6 per cent stake of A.K. Al Muhaidib and Sons Group in Al Azizia through a share swap as well.

As a result Al Azizia will be fully-owned by Savola compared with a current stake of 74.4 per cent, according to the statement.

Savola said it will acquire the shares from Alhokair at their fair value amounting to 297.6 million riyals (Dh291.46 million) and against the issuance of priority shares in Savola for Alhokair.

Relinquishing right

Savola will also pay 20.74 million riyals to Alhokair in return for relinquishing its right to buy an additional stake of up to 3 per cent in Al Azizia Panda over three years, according to the statement.

In August, Savola said that it will buy Al Muhaidib's stakes in Savola's units against the issuance of 37.63 million shares in Savola to Al Muhaidib.

This will bring the total Savola shares that will be issued for Alhokair and Al Muhaidib to 46.34 million which will represent 8.48 per cent of Savola's new capital once the two issues are completed, the statement said, adding the conclusion of the deals requires the approvals of the authorities and of Savola's shareholders and that Swicorp will act as financial advisor for the deals.

The move aims to support Savola's strategy to give more focus to the retail sector, Abdul Rauof Mana'a, Savola's managing director, said.