CMA nods to Qassim Cement's capital top-up to acquire Hail Cement

Logos of Qassim Cement Co. and Hail Cement Co.

The Capital Market Authority (CMA) approved Qassim Cement Co.’s (QCC) application to increase its capital from SAR 900 million to SAR 1.1 billion by issuing 20.56 million ordinary shares to acquire Hail Cement Co. (HCC) through a stock exchange offer, the market regulator said in a statement today, May 15.

QCC's capital increase shareholder circular will be published within sufficient time before the extraordinary general meeting (EGM). The shareholder circular must include all relevant information that the shareholders need to know before making an informed decision when voting on the capital hike for the purpose described, including risk factors, said the regulator.

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It added that its resolution included the approval of the proposed offer timetable and the publication of the offer document by QCC to HCC’s shareholders through a stock exchange offer.

QCC's offer document will be published to HCC shareholders to fully acquire HCC shares within sufficient time before HCC's EGM. The offer document must include all relevant information that the shareholders need to know before making an informed decision when voting on the offer, including the offer information and risk factors.

If QCC shareholders approved the capital increase, and HCC’s shareholders accepted the offer in their respective EGM, the new shares will be issued to HCC’s shareholders who are registered with the Securities Depository Center Co. (Edaa). Accordingly, HCC’s shares will be delisted from the Saudi Exchange (Tadawul) once the takeover decision becomes effective, according to CMA.

CMA also noted that its approval should never be considered as an endorsement of the acquisition's feasibility. It merely means that the legal requirements as per the Capital Market Law and its Implementing Regulations have been met.

QCC signed a binding agreement with HCC in December 2023. Under the deal, QCC will offer HCC shareholders 0.21 QCC shares for each HCC share to fully acquire the latter by issuing new QCC Cement shares, Argaam’s data showed.