Aslak CEO says financial valuation to set exchange ratio in Al Raeda deal

Nabil Al-Amir, CEO of United Wire Factories Co. (Aslak)

United Wire Factories Co. (Aslak) will rely on a thorough financial valuation and fair value comparison to determine the exchange ratio for its potential acquisition of a 40% stake in Al Raeda Industrial Investment Co., Aslak CEO Nabil Al-Amir told Argaam.

He said that the attractiveness of Aslak’s stock after the deal will depend on shareholders’ confidence in its success and the expected gains, such as improving profitability and expanding market scope.

He explained that this acquisition aims to achieve major strategic objectives, notably diversifying income sources by entering new industrial sectors and reducing reliance on a single activity.

Al-Amir indicated that the deal seeks to enhance profitability by investing in companies with strong financial performance, thereby maximizing shareholders’ equity.

He also pointed out that the deal will help Aslak expand into promising markets and achieve sustainable growth, strengthening its position in the Kingdom’s industrial sector.

Established more than 20 years ago, Al-Raeda owns three factories in the Western Province, and operates in the aluminum, paper and chemical products. It caters to a wide range of local and foreign markets, leveraging competitive advantages and high management capabilities.

The company has achieved constant returns with growth potential, driven by its target expansion plans, the CEO added.

Aslak recently signed a non-binding memorandum of understanding (MoU) for the potential acquisition of a 40% stake in Al Raeda, through the issuance of new shares to the latter's shareholders, according to data available with Argaam.