Friday, 29 March 2024

The company was having about SR4.5 billion, in cash, before the deal

Kingdom Holding’s Earmark SR4.5bln for New investments

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The Kingdom Holding’s CEO Talal Al-Maiman verified the news that the business has enough funds, to undertake fresh investments, without resorting to the last-ditch effort.

Cascade Investment bought half of the Kingdom Holdings shares in the “Four Seasons Holdings” through the latest deal.

Bill Gates owns 23.75 %, which has a market value of SR8.29 billion and a reserve of 23.75 %.

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The company still has about SR4.5 billion in cash before the deal, which can be used in new investments.

As for what will come in January 2022 from the sale of the “Four Seasons” share, it would be considered as new cash, and may be devoted to explore new domains or to deepen the “Kingdom Holding” investments, in place.

Al-Maiman noted that the decision was taken primarily on economic feasibility and profits, not on momentary conditions or the passing of certain assets, through certain economic cycles.

“Kingdom Holding is an experienced company in the field of investment, and the return on investment, which is an added value for investors, in addition to the profits obtained from the return on investment are the basis for further decision-making,”

Describing the deal as an “excellent” one, concluded between two major companies, based on their book value.

The CEO of Kingdom Holding Company considered that the value of the deal is fair and compatible with the expected return of the hospitality sector, as it goes back to pre-Covid-19 levels.

Also, the income from the “Four Seasons” transaction played a role in reducing the pressure of provisioning.

It will primarily be used for new investments, according to Al-Maiman.

A portion of it will be dedicated to repay existing debts, the majority of which are revolving loans.

However, if no new investments are made to open up global markets, the cash will be used to cut debts and lower borrowing costs.Due to the recent market conditions, Kingdom Holding is becoming more cautious, when it comes to making investment decisions. However, during the pandemic peak in the Year 2020, it established an investment program, of which a substantial portion has been implemented.

It is likely to be completed in the next weeks, by buying stocks in a handful companies, he concluded.

 

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