TADCO shareholders reject selling stake in Masader Agricultural for second time

Logo of Tabuk Agricultural Development Co. (TADCO) 

Tabuk Agricultural Development Co.'s (TADCO) shareholders rejected the board of directors' recommendation to sell the company's entire 60% stake in Masader Agricultural Feed Mill Ltd. Co. to partner Ahmed Hussein Al-Omari for SAR 8 million, including the factory owned by Ahmed Hussein Al-Omari Foundation, in which TADCO also has a 60% stake.

Shareholders made their decision during the ordinary general meeting (OGM) held on, Dec. 27, according to a statement to Tadawul.

The board's recommendation was based on the company's inability to transfer the ownership of the factory to Masader Agricultural. This was in addition to the positive effects resulting from the sale, the most important of which is halting the company’s losses from its investment in Masader Agricultural, with an average annual loss of SAR 4 million and achieving profit from the exit amounting to SAR 8 million.

The earnings will be realized in the income statement, resulting in a reduction of retained losses to 2% of capital. This will also result in achieving a SAR 8 million cash flow/liquidity for the company. The move was to remove the continuous observations from the external auditor’s report.

In October, TADCO's shareholders rejected the board's recommendation to sell the company's entire 60% stake in Masader Agricultural for SAR 8 million, according to data available with Argaam.