Takween Advanced Industries Co. — M&A Activity 2014

Dec 31, 2014

Takween Advanced Industries announces signing an agreement to purchase all of the shares in Savola Packaging Company for a price of 910 million Riyals

1201 · 31/12/2014 08:40:09 · Announcement #36498 · View on Saudi Exchange

Takween Advanced Industries announces signing an agreement to purchase all of the shares in Savola Packaging Company for a price of 910 million Riyals

Further to the announcement made by Takween Advanced Industries (Takween) on 26/09/1435H. (corresponding to 23 July 2014), regarding signing a non-binding memorandum of understanding with Savola Group (Savola) on 22 July 2014 (MoU) in relation to the potential acquisition by Takween of Savola Packaging Company (Target), a wholly owned subsidiary of Savola, as well as the supplementary announcement published on 13/01/1436H (corresponding to 6 November 2014) regarding the extension of the term of the MoU to 31 December 2014 and the supplementary announcement published on 06/3/1436H. (corresponding to 28 December 2014), Takween announces reaching an agreement with Savola after completing a thorough due diligence exercise and the signing of an agreement on 8/03/1436H. (corresponding to 30/12/2014) to purchase the entire shareholding of the Target for a total purchase price of 910 million Saudi Riyals. It should be noted that the completion of the Transaction and payment of the said purchase price remains subject to satisfaction of a number of conditions before 31 March 2015 which include completing certain regulatory procedures, obtaining consents from the concerned government agencies, including the Competition Council, and the satisfaction of certain commercial conditions agreed between the parties.

100% of the purchase price will be financed through a syndicate of Saudi banks, which will be announced upon concluding all financing negotiations with the banks, and which is subject to the approval of the ordinary general assembly of Takween.

It is worth mentioning that the Target owns two subsidiaries (Al-Sharq Plastic Company and New Marina Plastics Company in Egypt) and is engaged in production of plastic containers, barrels, bottles and covers, with a production capacity of 200,000 tonnes per year. The Target recorded profits in the last three years (2011, 2012 and 2013) of SAR 91.2 million, SAR 100.2 million and SAR 69.5 million respectively. Given that the transaction falls within Takween's strategic plans, it hopes this transaction will provide a qualitative leap in its expansion plans which should have a positive effect on its financial results and profits. It is expected that the financial impact will positively reflect on the Takween’s accounts from the second quarter of 2015.

Takween will announce any further developments in this matter.

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.