Arabian Mills makes SAR 50M prepayment under Murabaha facility with SAB

Arabian Mills said this Murabaha repayment will contribute to reducing financing costs, which will positively impact on the company's financial results.

Arabian Mills for Food Products Co.’s (Arabian Mills) said its board has approved a voluntary prepayment of SAR 50 million under its existing Murabaha agreement with Saudi Awwal Bank (SAB).

In a statement to Tadawul, the company said the payment will help reduce financing costs and have a positive impact on its financial results. The move is part of the company's efforts to strengthen its financial position and support the sustainability of its performance.

According to Argaam data, Arabian Mills said in its IPO prospectus that it entered into a Murabaha facility in 2021, with HSBC acting as investment and security agent and SAB as the lender. The facility was amended in September 2023 to include a SAR 1.5 billion term acquisition Murabaha facility, a SAR 273.05 million bridge Murabaha facility, a SAR 125 million capital expenditure Murabaha facility, and a SAR 150 million revolving working capital Murabaha facility.

Under the Murabaha agreement, the company’s existing shareholders are required to retain at least 51% of its shares.

The company said in June that its board had approved a voluntary advance payment of SAR 100 million under the same Murabaha agreement.