Naqi Water signs contract to waive lease rights of land with MODON

One of Naqi Water production line

Naqi Water Co. signed a contract to waive the lease rights to a land plot owned by Saudi Authority for Industrial Cities and Technology Zones (MODON) located in Riyadh. This land, with the buildings thereon, was previously intended to be leased to the company for the purpose of establishing a new bottled drinking water factory in Riyadh.

The waiver came due to the availability of an alternative opportunity with better advantages in terms of space and expected operational efficiency for the planned factory in Riyadh, the company said.

It added that the initial cost of acquiring the lease rights for the aforementioned land amounted to SAR 6.15 million, as stated in its announcement dated May 29, 2023. The net value of the lease waiver is valued at SAR 9.5 million.

Naqi Water noted that no additional costs are associated with the move, adding that it will announce the financial impact of the contract upon completing all regulatory procedures.

The company also said it will announce future updates related to the construction of the new factory in Riyadh and its financial impact in due course.

In May 2023, the company announced starting construction of a new factory in Riyadh and signed a contract to acquire an industrial property inclusive of all its facilities. The property was acquired as it was ready with the infrastructure necessary to operate the production lines, according to Argaam's data.

In December 2023, it signed an agreement to acquire a lease contract for an industrial land plot owned by MODON in Riyadh Second Industrial City. Under the deal, Saudi Spare Parts Pump Co. will waive the land to Naqi Water.

The contract also entails the transfer of the land lease to Naqi Water and the acquisition of the former's assets available on the land, including construction works and buildings.