SITCO Pharma gets SAR 230 mln settlement from Mawarid

Saudi International Trading Co (SITCO Pharma) has received SAR 230 million to settle a long-running dispute with Mawarid Trading, SITCO’s parent company Saudi Chemical Co. (SCC) said in a bourse statement.

A settlement agreement was signed on Tuesday and no financial impact is expected on company results.

SITCO signed an agreement in 2011 with Mawarid Trading to recover the SAR 230 million paid for acquiring a 50 percent stake in Al Dawaa Medical Services Co., according to reports published by Argaam.

In 2009, the pharmaceutical distributor agreed with Mawarid Trading to acquire 50 percent of Al-Dawaa for SAR 235 million, and give up its 15 percent stake in Mawarid Trading.

SITCO Pharma settled the difference between these two agreements by paying SAR 95 million to the sellers. However, SCC shareholders objected to the agreement and voted to cancel the deals. As a result, Mawarid was required to pay SAR 230 million.

SCC currently holds a 99 percent stake in SITCO Pharma.