FIPCO, Saudi EXIM Bank seal SAR 23M Murabaha agreement

Logo of Filing and Packaging Materials Manufacturing Co. (FIPCO) 

Filing and Packaging Materials Manufacturing Co. (FIPCO) has signed a master Murabaha agreement to grant short-term credit facilities with the Saudi EXIM Bank worth a total of SAR 23 million.

The agreement is effective from the date of its signing and will expire on Aug. 31, 2025. The Shariah- compliant loan will be repaid after 120 days from its disbursement date, the company said in a statement to Tadawul.

The guarantees offered for the financing include a promissory note covering the entire value of the credit facility. This is besides an endorsement for EXIM Bank as a second beneficiary of the insurance policy proceeds in a lump sum covering minimum 100% of the credit facility, it added.

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This came to enhance FIPCO’s export activities, in line with the board’s strategic direction following the positive impact fueled by the previously-signed agreement, which contributed mainly to boosting export volumes and value by 23% and 13%, respectively.

The above figures apply if the export volumes and values were compared before and after the signing of the master Murabaha Agreement that had been concluded on Sept. 13, 2023, and announced on the Tadawul website on Sept. 20, 2023, the company added.

The loan is a short-term revolving facility, aimed to finance working capital (pre-export) related to the company's raw material needs to support its export activities.

This year’s master Murabaha agreement was concluded on Nov. 12, 2024, FIPCO underlined. It also noted that undertaking the relevant legal procedures and obtaining the necessary signatures were completed. The final version of the agreement was received today, Dec. 9.

FIPCO hailed the Saudi EXIM Bank and the Saudi Exports Development Authority’s (SEDA) efforts as the financial and non-financial support initiatives and programs provided by them have stepped up the company’s stance among international markets, while also boosting its market share in several global countries, hence expanding the foothold of the company’s products and enhancing its brand presence in regional and global markets.