SVCP sells second plant for SAR 45M, expects SAR 20.1M capital gains

Saudi Vitrified Clay Pipes Co. (SVCP) signed, on Sept. 19, an agreement with Al-Mutahida Al-Namothajiya Industries Co. to sell the assets of its second plant, located in Riyadh’s Second Industrial City, which manufactures vitrified clay pipes and accessories.

 

 

The agreement also includes the transfer of the land lease for the plant site, according to a statement to Tadawul.

 

SVCP said the total sale value is SAR 45 million, excluding any fees or taxes.

 

The payment will be in two installments: SAR 9 million upon signing the agreement, and the remaining SAR 36 million upon approval by the Saudi Authority for Industrial Cities and Technology Zones (MODON) and completion of the lease transfer procedures to the buyer.

 

The land and existing assets will be handed over after the second payment, with the deal’s completion contingent on MODON’s approval of the lease assignment.

 

The book value of the asset is SAR 24.9 million as of June 30,2025, according to audited financial statements, with an expected capital gain of approximately SAR 20.1 million, the statement noted.

 

SVCP explained that the transaction is driven by declining demand for ceramic pipes, the low economic feasibility of maintaining the second plant, and the benefits of selling it while continuing production at the first plant. The proceeds will be used to finance operating activities in a manner that supports the interests of the company and its shareholders.

 

The company added that the sale aligns with its strategic plans to optimize asset and resource utilization and support future growth, noting that no related parties are involved in the transaction.