Saudi Arabia’s Takween to Buy Savola Unit for $242 Million

By Matthew Martin

Saudi Arabia’s Takween Advanced Industries Co. (TAKWEEN) agreed to buy Savola Group (SAVOLA)’s packaging unit for 910 million riyals ($242 million) in a rare example of a deal between two listed companies in the country.
The acquisition will be financed through bank loans, Takween said in a statement to the Saudi Stock Exchange. The two companies signed the sale agreement yesterday and Takween expects the acquisition to boost its earnings from the second quarter of 2015, it said. Savola will make a capital gain of 265 million riyals and will use the proceeds to support its foods and retail business, it said in a separate statement.
The value of completed mergers and acquisitions in Saudi Arabia has risen 6.9 percent to $443 million in 2014, after a more than 70 percent drop in 2013, according to data compiled by Bloomberg. Most transactions in the Arab World’s biggest economy have
been limited to private equity deals in the last couple of years.
Abraaj Group and U.S. buyout firm TPG Capital are nearing a deal to buy a majority stake in Saudi Arabian fast-food chain Kudu, two people familiar with the matter said in August. Olayan Group acquired a majority stake in beverage maker Gulf Union Food Co. from shareholders including Jadwa Investment Co., the companies said in a joint statement in July.