Al Khaleej Training sells Rowad School to Al-Rajhi REIT for SAR 244.5 mln

Al Khaleej Training and Education Co. signed on Dec. 24 a deal to sell Rowad AlKhaleej International School to Al-Rajhi REIT Fund for a total value of SAR 244.5 million, the company said in a bourse statement.

Al-Rajhi REIT obtained the approval of the Capital Market Authority (CMA) and the fund owners to complete the purchase. It also issued 13.61 million new units to pay the deal value, while the remaining amount was paid in cash.

The educational property will be re-leased to Al Khaleej for a period of 15 years from the date of ownership transfer, which took place on Dec.24, for an annual rent of SAR 18.9 million, whereby the annual rent increases by 7.5% every 5 years.

The school, which is located in Dammam, comprises a land plot measuring 20,213 square meters, with a built-up area of 25,797 sqm.

The sale and leaseback process is expected to provide liquidity and utilize returns to support the company’s financial position and future expansion, Al Khaleej said.

The sale proceeds will be also used to buy shares in Al Rajhi REIT and repay some of the company’s long-term debts.

No related parties are involved in the deal, the statement added.

Late in March 2019, Al Khaleej Training signed an MoU with Al Rajhi REIT Fund to sell and lease back three educational properties, Argaam reported.