| Element List | Explanation |
|---|---|
| Introduction | Umm Al-Qura Cement Company announces that it entered into a non-binding memorandum of understanding (“MOU”) with City Cement Company. pursuant to which the two companies agreed to commence discussions in relation to a securities exchange transaction pursuant to which City Cement will acquire will acquire all 55 million issued shares in Umm Al-Qura Cement (the “Proposed Transaction”). On this basis, Umm Al-Qura Cement and City Cement have agreed to proceed with relevant due diligence in relation to the Proposed Transaction. |
| Date of signing the Memorandum of Understanding | 2022-11-03 Corresponding to 1444-04-09 |
| Memorandum Duration | Six months can be extended subject to both partis approval |
| Name of the Counterparty | City Cement Co. |
| Name of Financial Advisor of Each Party | No financial advisor has been appointed at this stage. Umm Al-Qura Cement Company will later announce any developments about the appointment of its financial advisor. |
| Major Terms in the Memorandum | Pursuant to the non-binding MOU, Umm Al-Qura Cement and City Cement have agreed on that in case of The Proposed Transaction, should it proceed, will be implemented through a share exchange offer made by City Cement (in its capacity as the offeror) to Umm Al-Qura Cement (in its capacity as the offeree) for the purposes of acquiring all 55 million issued shares in Umm Al-Qura Cement. The consideration payable by City Cement to Umm Al-Qura Cement’s shareholders will be the issuance of new shares in City Cement in accordance with Article 26 of the Merger and Acquisition Regulations, as the value of the deal and the exchange factor will be determined after completing the necessary studies, including the due diligence, which would result in the delisting of Umm Al-Qura Cement’s shares, and becoming a company wholly owned by City Cement.
It should be noted that the MOU does not constitute a binding agreement to implement the Proposed Transaction, as the implementation of the transaction is subject to the Umm Al-Qura Cement and City Cement agreeing a final definitive agreement that determines the terms and conditions of the transaction. The terms and conditions of the final definitive agreement will include obtaining all the required regulatory approvals and the approval of each respective extraordinary general assembly of Umm Al-Qura Cement and City Cement on the transaction and its related matters. Umm Al-Qura Cement will announce all the relevant details at a later stage. |
| Related Parties | The Proposed Transaction may possibly involve related parties, and a number of members of the board of directors may have an interest in the Proposed Transaction. The details of this will be announced at a later stage. |
| Actions to be Taken by the Company during the Memorandum’s Duration | The parties intend to conclude the due diligence process and sign the definitive agreements in relation to the Proposed Transaction, if they agree to their final terms, as soon as practicable. |
| Approvals | The Proposed Transaction is subject to the regulatory approvals, including the approvals from the competent authorities such as the General Authority for Competition, the Capital Market Authority, the Ministry of Commerce and the approval of the extraordinary general assembly of each company. |
| Additional Information | Umm Al-Qura will announce any material developments in relation to the Proposed Transaction in accordance with the applicable laws and regulations. |
Umm Al-Qura Cement Co. Announces the Execution of Memorandum of Understanding with City Cement Co. Acquiring all the issued shares in Umm Al-Qura.
