Riyadh-based Intelligent Oud Company for Trading (iOud), a listed company on the Saudi Exchange, has announced a final agreement to acquire 100% of Thannah Trading Company. The landmark deal, valued at SAR 59.47 million (approximately $15.86 million), signals iOud’s strategic push to diversify its operations and expand into new market sectors.
The Deal Structure
The acquisition will be executed through a share swap mechanism rather than a cash transaction. iOud will facilitate the deal by increasing its capital by SAR 11.70 million ($3.12 million), issuing 1.17 million new shares directly to the owners of Thannah Trading. Following this capital hike, iOud’s total capital will grow by 60%, from SAR 19.50 million to SAR 31.20 million. Based on a three-month volume-weighted average price (VWAP) of SAR 50.83 per share, the Tadawul-listed company is valued at SAR 99.11 million.
Strategic Expansion into Hospitality and Food
This acquisition is a calculated move by iOud to bolster its presence in the competitive hospitality and food sectors. By integrating Thannah Trading’s operations, the company aims to create significant synergies that are expected to enhance revenues and improve profit margins over the medium to long term. The transaction aligns with iOud’s growth strategy to diversify its business portfolio beyond its core offerings.
Shareholder Impact and Regulatory Hurdles
The capital increase and issuance of new shares will result in a 37.50% dilution of stakes for iOud’s existing shareholders. The completion of the transaction is contingent upon securing several key regulatory approvals. These include green lights from the Capital Market Authority (CMA), the Saudi Exchange (Tadawul), the General Authority for Competition, and final approval from iOud’s extraordinary general assembly.
About Intelligent Oud Company (iOud)
Intelligent Oud Company for Trading is a Saudi-based company specializing in the trade of oud, perfumes, and related products. It is known for its innovative approach, which includes smart devices and vending machines for oud distribution, catering to both individual consumers and corporate clients. The company is publicly traded on the Saudi Exchange’s parallel market, Nomu.
Source: Zawya
