MEFIC REIT: MoUs signed to study acquisition of 2 properties, usufruct right

Logo of MEFIC REIT Fund

Middle East Financial Investment Co. (MEFIC Capital), the manager of MEFIC REIT Fund, announced that on Nov. 13 the company had signed three conditional memoranda of understanding (MoUs) with three different sellers.

The MoUs aim to study the potential acquisition of two properties in Makkah and Jeddah and a usufruct right over a property in Jazan.

In a statement to Tadawul, MEFIC Capital said Jeddah and Makkah properties span 66,600 and 36,000 square meters (sqm), respectively. Meanwhile, the Jazan property spreads over nearly 32,300 sqm.

After fulfilling the regulatory requirements and conducting legal, financial, and technical due diligence to ensure the soundness and integrity of the properties, MEFIC Capital will proceed to enter into final binding agreements with the sellers for the acquisition of the mentioned properties. This will be in consideration of increasing the fund's capital through the issuance of in-kind units to the sellers.

The final agreements are contingent upon fulfilling regulatory requirements and obtaining approvals from the Capital Market Authority (CMA), the fund’s board of directors, and unitholders.

MEFIC Capital clarifies that the MoUs last 60 days from the date of signing, renewable upon mutual consent.

Further, MEFIC Capital is not obligated to enter into the final agreements, as the MoUs are conditional upon completing due diligence and meeting regulatory requirements.

The fund manager will proceed with the final agreements only after confirming the feasibility, integrity, and legal soundness of the properties, as well as meeting all regulatory requirements.

MEFIC Capital expects a positive impact on the fund upon completing the transaction, executing the final agreements, and increasing the fund's capital.