Red Sea International, Al Rajhi sign SAR 330 mln agreement to finance acquisition

Logo of Red Sea International Co.

Red Sea International Co. signed on Sept. 28 a financing facility agreement contract worth SAR 330 million with Al Rajhi Bank.

The agreement aims to finance the acquisition of a 51% stake in Fundamental Installation for Electric Work Co. Ltd. (First Fix), the company said in a statement to Tadawul, adding that it obtained a loan of SAR 250 million to cover the purchase agreement's cash portion.

The agreement is valid until the completion of the acquisition process, with a repayment period of seven years.

A pledge of shares in a sister company, a pledge of Red Sea International shares in the acquired entity (First Fix), the assignment of a project proceeds to cover the loan annual repayment amount with interest, and a promissory note pursuant to the agreement guaranteed by a sister company were all provided as guarantees.

The agreement includes related parties, namely Al-Dabbagh Group (ADG), Tanmiah Commercial Group, and Petromin Corporation.

In June 2022, Red Sea International announced it had acquired a 51% stake in First Fix for SAR 544.2 million, according to data available on Argaam.

The sellers will be paid SAR 250 million in cash in the specified proportions, while a deferred consideration of SAR 294.2 million will be settled within four months from the signing date, subject to the fulfillment of certain conditions.

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