Advanced Building Industries Co. — M&A Activity 2011

Apr 17, 2011

ZAMIL INDUSTRIAL ANNOUNCES THE SIGNING OF THE FINAL MERGER AGREEMENT WITH GULF INSULATION GROUP TO MERGE SELECT INSULATION BUSINESSES

2240 · 17/04/2011 16:42:08 · Announcement #21302 · View on Saudi Exchange

ZAMIL INDUSTRIAL ANNOUNCES THE SIGNING OF THE FINAL MERGER AGREEMENT WITH GULF INSULATION GROUP TO MERGE SELECT INSULATION BUSINESSES

Further to Zamil Industrial Investment Company (Zamil Industrial) announcement on 21 September 2010 on signing the merger term sheet for the possible merger of select insulation businesses in a new company with Gulf Insulation Group (GIG), the company would like to inform its shareholders that the parties signed the final merger agreement Sunday afternoon (17/04/2011) in Riyadh in the presence of representatives of both partners.

The total cash investment by Zamil Industrial in the merger company is SAR 150 million through internal financing. The Enterprise Value of the new company will be SAR 830 million excluding the stake of the foreign partners in some of the merged companies. Zamil Industrial will be the managing partner with a 51 percent controlling stake.

The newly formed company is expected to bring additional net profits to Zamil Industrial by end of 2011. It is worth mentioning that this new company will be consolidated under Zamil Industrial from 01/01/2011.

Abdulla M. Al Zamil, CEO of Zamil Industrial, said that we have been working over the last five years on developing the insulation sector which included fiberglass and rubber insulation products and now added the rockwool and pre-insulated pipes. These product offerings will cover the growing market demand for insulation material that effectively conserves energy and reduces consumption. We also call to expedite the introduction of the Saudi building codes systems.

Abdulaziz M. Al Namlah, Chairman of Gulf Insulation Group, praised this new partnership with Zamil Industrial which will bring great value to both partners who have extensive expertise in the insulation industry and building material.

The newly formed merger company will include the partners stake in the following companies:

1. Arabian Fiberglass Insulation Co. (AFICO)

2. Armacell Zamil Middle East Co. (AZMEC)

3. Saudi Rockwool Factory Co. (SRWF)

4. Saudi Pre-Insulated Pipes Industries (SPPI).

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