SABIC Agri-Nutrients Co. — Capital/Financing Update 2018

Nov 4, 2018

Saudi Arabian Fertilizer Company (SAFCO) announces signing non-binding Memorandum of Understanding (MoU) with SABIC

2020 · 04/11/2018 08:49:43 · Announcement #52496 · View on Saudi Exchange

Saudi Arabian Fertilizer Company (SAFCO) announces signing non-binding Memorandum of Understanding (MoU) with SABIC

Element List	Explanation
Introduction	SAFCO announces signing a non-binding Memorandum of Understanding (MoU) with (SABIC) on Thursday evening 1/11/2018 . The MoU defines the Principles of cooperation between the two parties regarding SAFCO acquisition of SABIC's investments in the affiliates that produce agri-nutrients and some relevant products
Signing date of the memorandum	2018-11-01 Corresponding to 1440-02-23
Signed party	Saudi Basic Industries Corporation - SABIC
Memorandum Subject	Principles of cooperation between the two parties regarding SAFCO acquisition of SABIC's investments in the affiliates that produce agri-nutrients and some relevant products
Memorandum Duration	18months from date of signing the MoU
Related Parties	SABIC is a Saudi joint stock company listed on the Saudi Stock Exchange. It was established in 1976 with a capital of SR (30,000) million. It owns 50% of Ibn Al-Baytar and SABIC owns 42.99% of SAFCO

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The General Organization for Social Insurance (GOSI) is a major shareholder in (SAFCO) and owns (10,54%) of its shares. Also, (GOSI) is a major shareholder in (SABIC ), and owns ( 5,7 %) of its shares. Financial Impact Nil Additional Information The MoU outlines the principles of cooperation between the two parties and contains the following key principles:

First:

SABIC is taking the necessary steps to establish a limited liability company under the name of SABIC Agri-Nutrients Investments Company – wholly owned by SABIC. The new company owns SABIC's investments in the affiliates that produce Agri-nutrients and some relevant products, referred to in the table attached to this announcement

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Second:

Following completing the transfer of ownership of the investments, referred to in “First” above to SABIC Agri-Nutrients Investments Company, both SABIC and SAFCO will arrange for an agreement on how to evaluate SABIC Agri-Nutrients Investments Company

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Third:

In the event of an agreement between the two parties on the value of SABIC Agri-Nutrients Investments Company, SAFCO will make an offer to buy SABIC Agri-Nutrients Investments Company in cash or against issuing shares for SABIC in SAFCO by increasing its capital, or by both – after completion of the relevant regulatory approvals

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On the other hand, The two parties agreed on a number of basic principles and preconditions for the implementation of the transaction, including conducting legal, financial and technical due diligence, appointing the competent consultants to do so, studying the evaluation, completing the contractual negotiations and obtaining the necessary preliminary approvals.

In addition, SAFCO emphasizes that the signing of the Memorandum of Understanding has no significant financial impact and is not a final agreement on the potential deal. Also, it does not constitute an offer or a firm intention to make a presentation by SAFCO to SABIC. This Memorandum is a non-binding agreement entered into for the purpose of cooperation between the two companies on the verification work referred to in this announcement.

In addition, If SAFCO buys SABIC Agri-Nutrients Investments Company, SAFCO will follow all relevant regulatory instructions and procedures Attached Documents  

The Capital Market Authority and Saudi Exchange take no responsibility for the contents of this disclosure, make no representations as to its accuracy or completeness, and expressly disclaim any liability whatsoever for any loss arising from, or incurred in reliance upon, any part of this disclosure, and the issuer accepts full responsibility for the accuracy of the information contained in it and confirms, having made all reasonable enquiries, that to the best of their knowledge and belief, there are no other facts or information the omission of which would make the disclosure misleading, incomplete or inaccurate.