Savola seeks shareholder nod for sukuk plan
Riyadh, October 22, 2012
Saudi-based Savola Group will seek shareholder approval for plans to issue Islamic bonds, or sukuk, the company said in a statement to the kingdom's bourse on Monday.
The firm, which owns the Middle East's biggest sugar refining business, will propose the plans at an Extraordinary General Meeting (EGM), the date of which will be announced once regulatory approvals for the move have been granted, the statement said.
The proposal includes the company's right to issue sukuk or any other securities, through one or more tranches or a series of issues under one or more programmes.
Savola did not specify the currency in which it would seek to issue sukuk but Saudi companies are actively looking to tap high liquidity in the local market and take advantage of low borrowing rates through riyal-denominated issues.
Earlier this month, Savola posted a forecast-beating 31.6-percent rise in third-quarter profit on the back of higher sales and market share.
The company also raised its stake in fellow food firm Almarai Co to 36.5 percent after buying shares worth 2 billion riyals ($533 million), in line with company strategy to increase exposure in its core sectors.
Savola financed the deal with its own cash reserves and Islamic loan financing provided by local banks. - Reuters