Almarai sells 5.6 mln shares of Zain KSA, eyes divesting entire stake in next 12 months

Logos of Almarai and Zain KSA

Almarai Co. sold 5.6 million shares of its holding in Mobile Telecommunication Company Saudi Arabia (Zain KSA) for a total cash value of SAR 81.1 million during the third quarter of 2021.

Accordingly, the juice and dairy producer lowered its stake in Zain KSA to 0.4% (3.9 million shares) by the end of September from 1.1% (9.5 million shares) in June.

Moreover, Almarai is planning to divest its remaining stake, 3.9 million shares, in the telecom operator within the next 12 months.

The abovementioned sale came after the pledge of its shares in Zain KSA was completed on March 21, 2021 to guarantee the loan provided earlier by Banque Saudi Fransi to the Tadawul-listed telco.

Almarai owned 2.5%, or 35 million shares, of Zain KSA upon its establishment in 2008.

Zain KSA has been recently financially stressed. The telecom operator’s founders, including Almarai, supported the telco to refinance its debts through pledging shares to creditors and extending the debt repayment periods to the founders.  

In addition to those guarantees, the founding shareholders offered Zain KSA loans. Zain KSA owes Almarai a total of SAR 109.6 million.