Cenomi Retail major shareholders to sell 49.95% stake to Al-Futtaim for SAR 2.5B

Logo of Fawaz Abdulaziz Alhokair Co. (Cenomi Retail)

Fawaz Abdulaziz Alhokair Co. (Cenomi Retail) received a notice from several major shareholders — Fawaz Alhokair, Abdul Majeed Alhokair, Salman Alhokair, Saudi FAS Holding Co., and FAS Real Estate Co. (the selling shareholders)— regarding the signing of a share purchase agreement (SPA) with Al-Futtaim Retail on July 18.

Under the terms of the agreement, the selling shareholders will sell a part of their stake in the company—approximately 57.33 million shares, representing 49.95% of the company’s total capital—to Al-Futtaim for SAR 2.52 billion (SAR 44 per share), through a private acquisition deal.

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In a statement on Tadawul today, July 20, the company said the deal is subject to several conditions, including obtaining approvals and no-objection letters from relevant authorities.

The agreement also stipulates, as a condition precedent to completing the private deal, that Al-Futtaim and Cenomi Retail enter into a shareholder loan agreement (in an amount no less than SAR 1.3 billion before the transaction is completed).

The agreement would include terms and conditions acceptable to the company, whereby Al-Futtaim would provide the mentioned loan to Cenomi Retail upon completion of the private deal.

The transaction will be executed as a negotiated deal in accordance with the trading and membership procedures of the Saudi Exchange (Tadawul) on the closing date.

Following the completion of the private deal, Al-Futtaim will own 49.95% of Cenomi Retail’s total capital.

Cenomi Retail noted that Al-Futtaim operates across several sectors, including fashion and retail, and holds franchise and operational rights for a wide range of global brands.

The company stated that Al-Futtaim’s entry as a strategic investor and its provision of the aforementioned shareholder loan is expected to strengthen Cenomi Retail’s balance sheet and support its growth prospects in the next phase.

Cenomi Retail will announce any updates regarding this matter — including the completion of the private deal — in due course, the statement added.

In a separate statement to Tadawul today, the company explained that discussions are still ongoing regarding the shareholder loan agreement that the strategic investor intends to enter into with the company.

It confirmed that the SPA includes a condition requiring the signing of the shareholder loan agreement (amounting to no less than SAR 1.3 billion), aimed at strengthening the company’s balance sheet and supporting its future growth.

Consequently, the strategic investor’s acquisition of the stake in the company is conditional upon agreement on granting the shareholder loan following completion of the private deal.

The company emphasized that the acquisition deal remains subject to a number of conditions, including obtaining the necessary regulatory approvals. Any material developments will be disclosed in a timely manner, including any updates related to the shareholder loan agreement, in accordance with applicable regulatory requirements and procedures.

According to data available with Argaam, Cenomi Retail announced in January that it had terminated negotiations with one of the world’s leading fashion retailers regarding a potential material transaction involving the consolidation of several fashion agencies.

At the time, the company stated that it was exploring other strategic options, including the possibility of a transaction with a strategic investor.

On July 6, the company announced that the strategic investor intends to acquire a 49.95% stake in Cenomi Retail’s capital. It also noted that discussions are currently underway to finalize an agreement with several major shareholders — Abdul Majeed Alhokair, Salman Alhokair, Fawaz Alhokair, Saudi FAS Holding Co., and FAS Real Estate Co. — to execute the acquisition through a private acquisition deal.

Al-Futtaim Retail brings over 50 years of experience in the retail sector, operating in more than 10 countries with a network of over 300 stores. Its portfolio includes 30 brands spanning a wide range of categories such as fashion, homeware, electronics, furniture, and more.