Saudi Arabia’s Red Sea International Co. announced it acquired a 51 per cent stake in local construction firm Fundamental Installation for Electric Work Co. Ltd. (First Fix) for a total transaction value of 544.2 million ($145 million).
First Fix, a mechanical, electrical & plumbing firm, made a net profit of 39.4 million USD (SAR 148 million) in 2022.
Red Sea said it will initially pay 66.6 million USD (SAR 250 million) in cash to the sellers.
The acquisition will be funded through bank loans.
Further, a deferred consideration of 78.3 million USD (SAR 294.2 million) will be settled within four months from the signing date, subject to satisfaction of certain conditions, the prefabricated housing company said in a statement.
Red Sea will retain the option to capitalize the debt represented by the deferred consideration, it added, noting that any similar transaction will be subject to applicable regulatory and corporate approvals.
The sellers are MSB Holding Co., a limited liability company incorporated in Saudi Arabia, Fares Esmat Al Saady and Ziad Jan Alsayegh.
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