TLDR:
Savola to distribute Almarai stake
Extraordinary meeting set for approval
Capital cut planned to boost structure
RIYADH (The Thursday Times) — Savola Group, Saudi Arabia’s largest food products company, has announced a strategic move to distribute its entire stake in Almarai, the region’s prominent dairy producer, to eligible shareholders. This capital restructuring is part of Savola’s ambitious three-stage plan to streamline its financial structure, aiming to boost liquidity, support investment in growth sectors, and reduce debt.
This planned distribution forms the core of Savola’s financial optimisation efforts. The Extraordinary General Assembly meeting, scheduled for December 12, will seek shareholder approval for the company’s proposals, including a substantial capital reduction. Savola aims to reduce its capital by more than half, reallocating funds towards other strategic areas and delivering its stake in Almarai to its shareholders. This step reflects Savola’s dedication to building a leaner, more efficient capital structure aligned with long-term financial stability.
Almarai share distribution
At the centre of Savola’s plan is its decision to transfer its 34.52% stake in Almarai to shareholders, valued at over SAR 8 billion. By redistributing these shares, Savola expects to strengthen its financial position, directing freed resources towards critical growth opportunities and portfolio expansion. This in-kind distribution follows a SAR 6 billion rights issue launched in August, which was the first phase of the company’s financial reform.
Capital reduction
Savola’s capital reduction, cutting the company’s capital base by 73.54%, is designed to enhance resilience and better position the company to manage future growth and debt obligations. This move aligns with its long-term strategy of capital optimisation, reducing debt exposure, and reinvesting in high-yield areas of the business. By reducing reliance on external financing, Savola hopes to create a stable financial structure that allows for more flexible growth trajectories within its diversified portfolio.
