Bawan Company announces that it has signed a Sale and Purchase Agreement with Petronash Global Limited to acquire the entire equity shares of Petronash Holding Limited.

Element List	Explanation
Introduction	Bawan Company (“Bawan” or "the Buyer)" announces that it has signed a Sale and Purchase Agreement (“SPA”) with Petronash Global Limited (“the Seller”), both the Seller and the Buyer are referred to as (the “parties”), to acquire the entire equity share of Petronash Holding Limited (“the Company” or “Petronash”) with a total value of 175 million US dollars (equivalent to approximately 656 million Saudi riyals) (subject to adjustment based on the company's future results).
Transaction Details	The parties agreed to value the entire equity shares of the Company at 175 million US dollars (equivalent to approximately 656 million Saudi riyals), contingent on the Company achieving specific future results. Bawan will pay the Seller an initial amount of 80 million US dollars (equivalent to approximately 300 million Saudi riyals), in exchange for transferring ownership of 80% of the Company’s shares to Bawan subject to fulfilling certain conditions in accordance with the SPA. Additionally, Bawan will pay the Seller a maximum of 60 million US dollars (equivalent to approximately 225 million Saudi riyals), if the Company achieves specific financial results over a period of three financial years (2024-2026). Further, the parties agreed that Bawan will purchase the remaining 20% shares of the Company after the issuance of the Company’s audited financial statements for the financial year 2027 or 2028 based on an agreed valuation method and a specific mechanism.
Transaction Amount	175 million US dollars (equivalent to approximately 656 million Saudi riyals) (subject to adjustments).
Transaction Conditions	- The SPA includes customary warranties provided by the parties (including business and tax warranties by the Seller). - The SPA is subject to several contractual terms and conditions necessary before completion of the deal, including obtaining the approval of the General Authority for Competition.
Parties of the Transaction	1. Bawan Company. 2. Petronash Global Limited.
Transaction Financing Method	The transaction will be financed through bank facilities in addition to Bawan’s internal cash flows.
Date of Entering Into The Transaction	2024-10-27 Corresponding to 1446-04-24
Description of Activity of The Asset Subject of The Transaction	Petronash was established in 2000 in the UAE and is considered one of the leading global manufacturers of engineered packaged solutions for the oil and gas sector. The Company operate primarily in the GCC market, with approximately 1,000 employees and a group of factories located in Dammam, Saudi Arabia, Dubai and Abu Dhabi, UAE, Doha, Qatar and Chennai, India, with a total manufacturing area of approximately 120,000 square meters. The Company primarily supplies its products to national oil and gas companies in the GCC countries and exports its products to other countries in the Far East, Africa and the Americas.
Financial Statements for the Last Three Years of the Asset forming the Subject Matter of the Transaction	Results in Million SAR (covering all Petronash subsidiaries in all regions): 1) Financial results for the period ending September 30, 2024 (unaudited): - Revenue: 699 - Net profits: 69 2) Financial results for year 2023: - Revenue: 722 - Net profits: 46 3) Financial results for year 2022: - Revenue: 472 - Net profits: 5 4) Financial results for year 2021: - Revenue: 238 - Net losses: (73) It is worth noting that the results of 2021 were mainly negatively affected by the Covid pandemic.
Transaction reasons	This acquisition reflects the commitment of Bawan management to its strategy of business diversification by entering promising industrial sectors and manufacturing specialized engineering products, which maintains its sustainable growth in key markets and maximizes its shareholders returns.
Expected Impact of the Transaction on the Company and Its Operations	This acquisition enhances Bawan's ability to expand its business, products and customers, and leverage the company's operational scale to drive long-term sales growth and profitability.
Related Parties	None.
Additional Information	It is worth mentioning that Bawan’s advisors for this transaction are: The legal advisor: Khoshaim and Associates (K&A). The financial advisor: PricewaterhouseCoopers. The commercial advisor: Rystad Energy. Also, Petronash was advised by Freshfields Bruckhaus Deringer LLP and Piper Sandler Ltd. Bawan will announce any material developments related to the transaction in due course.