Tadawul Group's Wamid closes acquisition of 51% of DirectFN for SAR 134 mln

Logo of Tadawul Advanced Solutions Co. (Wamid)

Saudi Tadawul Group Holding Co. (Tadawul Group) announced that its wholly-owned subsidiary Tadawul Advanced Solutions Co. (Wamid) completed on May 7 the transaction with National Two Ventures LLC (sole proprietorship) to acquire a 51% stake in Direct Financial Network Co. (DirectFN).

The SAR 134 million worth of deal is subject to post-completion adjustments, in accordance with the agreement, the group said in a statement to the Saudi Exchange.

The transaction will be funded by Tadawul Group’s internal resources, which will be covered by a Shariah-compliant bank facility.

Certain conditions related to the restructuring of DirectFN have been moved to post-completion obligations, in accordance with the agreement, the statement added.

Tadawul Group will announce any material developments, in accordance with the relevant regulatory requirements, it said.

The acquisition is another milestone for Wamid as it seeks to acquire capabilities that will accelerate its expansion, introduce innovative products and services to capital market stakeholders and ensure revenue diversification of the Saudi Tadawul Group.

The transaction will enable Wamid and Tadawul Group to expand regionally and globally, leveraging DirectFN’s geographical reach across 20 countries. Through DirectFN, Wamid will gain access to two development centers that can be leveraged for their technical expertise in emergent technologies, along with 500 employees, 300 software developers and new clients. Wamid’s ability to offer innovative emerging technologies to the Saudi capital market will be key in advancing the Kingdom’s role as a leading global digital economy, in line with Vision 2030’s Financial Sector Development Program.

DirectFN offers a range of application software platforms that serve brokerage houses, banks, clearing members, asset managers and Fintech companies as well as institutional and retail investors.

The acquisition of DirectFN is the third key milestone for Wamid, following the launch of its co-location service and Liqaa, diversifying sources of recurring revenue for the Group and increase its revenues. While DirectFN will operate independently, for now, its financials will be consolidated with Wamid’s in the near future.

Speaking on the transaction, Mohammed Al Nory, CEO of Wamid, said, “The acquisition of DirectFN is a key milestone in our journey to providing market participants with value-add services that unlock the power of technology and data in capital markets."

"The transaction will help us accelerate innovation in the existing STG business, pursue exciting new business opportunities and identify new revenue sources,” he noted.

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