The Extraordinary General Meeting of Emaar the Economic City has decided to discuss the increase in the company’s capital by transferring the debt that the company will have to the Public Investment Fund, for a total value of 2.83 billion riyals, according to which the fund will acquire 25% of the capital.
The company stated in a statement on “Tadawul Saudi” today Monday that the general meeting approved the board’s recommendation to increase the company’s capital by 33% from 8.5 billion riyals to 11.333 billion riyals.
The capital increase aims to pay off the debt that will be owed by the company to the Public Investment Fund (in as creditor) and to transfer it to 283.333 million new ordinary shares allotted to the fund in full, according to the shareholders’ circular which was published sufficiently before the date of the Extraordinary General Meeting.
The company has indicated that the number of shares will increase from 850 million to 1.133 billion shares after the increase.
Emaar said it aims to convert debt to improve the company’s liquidity and credit standing, providing greater solvency regarding its financial obligations and increasing the company’s ability to achieve its growth goals.
The General Meeting also approved the amendment of Article Seven of the Articles of Association, relating to capital and shares, as well as the amendment of Article Eight of the Articles of Association, relating to the subscription of shares.
The company had reached an agreement to transfer part of its debt to the Ministry of Finance in a stake in the company’s Public Investment Fund, which would reduce the company’s liabilities by approximately 27%.
to announce #Public investment fund And Emaar the Economic City (EEC) announced today the completion of an investment transaction in on the basis of which the fund becomes one of the main shareholders of the company with a 25% stake.
– Public Investment Fund (@PIFSaudi) September 27, 2021
For its part, the Public Investment Fund announced, in another press release, the completion of an investment transaction in on the basis of which the fund will become one of the main shareholders of Emaar the Economic City with a 25% stake.
The fund stated that the transaction is in in line with the 2021-2025 fund strategy, which aims to build strategic economic partnerships, and will also develop areas of cooperation between the company and the companies in fund portfolio, in particularly in the real estate, manufacturing, logistics and tourism sectors, which improves the achievement of attractive long-term returns for the fund and shareholders.
The fund continued: “The agreement helps improve the Kingdom’s basic infrastructure and support economic development. The investment agreement is expected to contribute to the development of Emaar the Economic City by strengthening King Abdullah Economic City’s role as an important promoter of the Kingdom’s social, economic and tourist development “.
The investment agreement will focus on maximizing and releasing the capacities of promising non-oil sectors, in to support the Kingdom’s efforts to diversify sources of income, increase strategic and operational value, and improve basic infrastructure.
Commenting on the completion of the transaction, the head of the general administration of local real estate investments at the Public Investment Fund, Ayman bin Muhammad Al-Mudaifer, said that the completion of this agreement represents a success not only for the fund and Emaar Economic City, but also to contribute to the strengthening of the Saudi economy in in line with the Kingdom’s Vision 2030 goals.
Al-Mudaifer added: “Our investment in Emaar is in in line with the fund’s 2021-2025 strategy, which aims to build strategic economic partnerships through the fund, as well as unlocking the capacities of promising sectors in the Kingdom, including transport, logistics, real estate and tourism ”.
For his part, the CEO of Emaar the Economic City (EEC) Cyril Bayaya said: “We welcome the Public Investment Fund as one of the main contributors to Emaar the Economic City, as this strategic partnership aims to activate the role of King Abdullah Economic City as a platform for the Kingdom’s social and economic development in in line with the objectives of the Vision 2030 “.
In a separate release, Emaar the Economic City announced a change in the composition of its board of directors following the completion of the share subscription agreement that the company and some of its major shareholders have entered into with the Public Investment Fund.
The company announced that the Board of Directors has approved the resignation of three members of the Board of Directors, including the CEO, and the appointment of three new members.
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