SPIMACO completes full acquisition of Dammam Pharma

Logo of Saudi Pharmaceutical Industries & Medical Appliances Corporation (SPIMACO)

Saudi Pharmaceutical Industries and Medical Appliances Corporation (SPIMACO) raised its direct ownership in Dammam Pharmaceutical Co. (Dammam Pharma) to 100%. 

SPIMACO said that it purchased the 15% stake in Dammam Pharma from Morocco’s pharmaceutical company Cooper Pharma for SAR 27 million, according to a statement to Tadawul. 

SPIMACO transferred the shareholding through acquiring a 20% stake in Dammam Pharma for SAR 26.87 million from its wholly owned subsidiary ARAC Healthcare, bringing the total value of the transaction to SAR 53.87 million, the statement added. 

The company financed the acquisition from its own resources. It noted that the transaction aligns with its strategy, which seeks to strengthen and improve its assets, in addition to increasing operations and utilizing production capacity to drive organic growth.  

This deal also seeks to save operational costs and reduce overhead expenses, the company added. 

SPIMACO expects that the acquisition will result in Dammam Pharma becoming a wholly owned subsidiary. It will also lead to consolidating the financial statements for the benefit of the group rather than the other partner. 

Moreover, SPIMACO said that the share transfer from ARAC Healthcare will not have any impact on the group's consolidated financial results. There are no related parties to the deal, nor are any preferential terms set forth therein, according to the statement. 

In 2022 and 2023, SPIMACO employed its operations in many investments with the aim of leveraging efficiency and increasing returns on its assets. 

During this period, the business process mechanism at Dammam Pharma was also modified to improve the utilization of production capacity and meet market demand, which led to a noticeable increase in the operating capacity utilization rate to 100% in September 2023, compared to 15% in December 2022. 

This in turn led to an improvement in the company’s overall financial performance, whereas Dammam Pharma’s revenue amounted to SAR 31.5 million, with a net profit of SAR 4.6 million in the first nine months of 2023. 

SPIMACO added that Dammam Pharma works in manufacturing, marketing, and selling pharmaceutical products. The following table illustrates the company’s revenue and profit during the last three years: