iOud inks final deal for Thannah’s SAR 59.5M acquisition via capital hike

Logo of Intelligent Oud Trading Co. (iOud)

Intelligent Oud Trading Co. (iOud) signed today, Oct. 15, a final acquisition agreement with the owners of Thannah Trading Co. to acquire 100% of the latter’s capital for SAR 59.47 million.

The acquisition will be executed through a capital increase by issuing 1.17 million new shares in favor of Thannah’s owners, iOud said in a Tadawul disclosure.

It explained that iOud was valued at a total of SAR 99.12 million, based on a benchmark price of SAR 50.83 per share.

This price was determined using the Volume Weighted Average Price (VWAP) over the three months preceding the signing of the memorandum of understanding (from Feb. 9 to May 9, 2025). This is the standard methodology used for such share-based acquisition transactions.

The proposed capital increase is expected to lead to a relative 37.5% decrease in the ownership of iOud’s current shareholders in order to issue new shares for Thannah owners.

This transaction aims to strengthen the company’s financial and operational position. In addition, it will pave the way for iOud’s expansion into the hospitality and foods products sectors, in line with its growth strategy.

The planned acquisition, according to iOud, is poised to have a positive impact on its revenues and profit margins in the medium and long term, benefiting from synergies, a larger customer base, and improved operational efficiency. Full financial details and risk factors related to that deal will be disclosed in the shareholders’ circular that will be published later.

The company also highlighted a related party, Abdullah Adlan, who is a board member in iOud and also general manager of Thannah. Accordingly, he was excluded from all deliberations and votings related to this acquisition transaction, in compliance with relevant regulations.

If the terms and conditions for acquisition completion are not met within 12 months from the signing date (extendable by mutual agreement), either party reserve the right terminate the agreement without compensation.

The acquisition is subject to meeting certain regulatory conditions, including approvals from:

1. The Capital Market Authority (CMA) regarding iOud’s acquisition of Thannah.

2. The Saudi Exchange (Tadawul) for listing the new shares issued as consideration.

3. The General Authority for Competition (GAC) for non-objection to the acquisition.

4. Extraordinary general assembly’s approval on the planned transaction.

5. Any other necessary regulatory approvals, provided no governmental or judicial authority issues a regulation, order, or decision preventing the completion of the acquisition.

In May, iOud signed a non-binding memorandum of understanding (MoU) with Afaq Food Fund, a closed-end investment fund managed by Afaq Capital, outlining the potential acquisition of 100% of the capital shares in Thannah through a share swap agreement, Argaam data showed.

In September, iOud received official letters from all current shareholders of Thannah, noting their preliminary acceptance of iOud’s offer to acquire their full ownership stakes. Thannah’s current stakeholders include Afaq Food Fund (owning 99.99%) and an individual private shareholder (holding 0.01%).