Cash from MMG auction won’t go to shareholders, says former chairman

Mohammad Al Mojil Group’s (MMG) shareholders will not be getting any of the cash generated after the troubled company auctions off its assets, former chairman Shakhboot Al-Dosari, has told CNBC Arabia.

He said the assets will likely sell for less than their value, as the creditors will get about 10 percent to 20 percent of their due debts.

Most of MMG’s properties and equipment are private property of Mohammad bin Hamad Al Mojil, as most assets weren’t transferred to the company’s ownership upon its IPO, Al-Dosari said.

The company announced on Tuesday to the Saudi bourse that a court ordered it to auction 21 percent of its fixed assets under a legal directive issued on Dec. 22, 2016. Another directive dated Nov. 22, 2016 banned the company from removing assets from its buildings.

According to data compiled by Argaam , MMG was ordered by the Dammam court to pay a total of SAR 742.5 million pertaining to legal claims brought against it.