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Kingdom Holding Reaches a Binding Agreement to Acquire 16.2 % Stake in Banque Saudi Fransi In a Deal Worth USD 1.5 Billion

September 12, 2017

 

Kingdom Holding Company (“KHC”) announced today it will acquire 16.2 percent stake in Banque Saudi Fransi (“Bank” or “the Bank”) for SAR 29.5 per share, a deal with total consideration of approximately SAR 5.8bn (USD 1.5bn), positioning KHC as the largest shareholder in the Bank. 

KHC will acquire the 16.2 percent stake from Credit Agricole Corporate and Investment Bank, the corporate and investment banking arm of Crédit Agricole S.A., which, along with KHC, will remain as a strategic investor in the Bank and will continue to support the growth and expansion of its operations.

“This transaction is the culmination of management efforts over the past 3 years to increase KHC’s recurring cash flow and profitability. Banque Saudi Fransi’s solid financial performance will have a positive impact on KHC’s financial results upon closing of the transaction”, said Mohamed Fahmy, KHC Chief Financial Officer.

KHC Chief Executive Officer Eng. Talal Al Maiman explained that the investment in the Bank is a core step in balancing KHC’s portfolio. KHC has a long and successful track record investing in the banking sector internationally and was attracted to this investment given its unique value proposition compared to the sector. KHC’s strategy is to continue to adjust its portfolio to optimize the mix of income generating assets and growth investments.

Commenting on this transaction, HRH Prince Alwaleed Bin Talal, Chairman of KHC said “Our investment in Banque Saudi Fransi demonstrates our core belief in the outlook for the Saudi economy underpinned by Vision 2030 and the National Transformation Plan”.

The transaction is expected to close in the second half of 2017, subject to customary closing conditions including required regulatory approvals.

About Kingdom Holding Company:

Founded in 1980, KHC is a publicly traded company which was listed on Tadawul (the Saudi Stock Exchange) in 2007. Founded and Chaired by HRH Prince Alwaleed Bin Talal, KHC is one of the world’s successful and diversified business organizations, highly respected in the field of investments and recognized as an elite investment player in the Arabian Gulf region, and internationally. The Company is recognized as one of the largest foreign investors in the United States. KHC’s portfolio has major interests in investment categories ranging from luxury hotels management companies, hotel real estate investments, technology, entertainment, and financial services. Among KHC’s recognizable current investments are Citigroup, NewsCorp, Twitter, JD.com, Four Seasons and Accor Hotels.

About Banque Saudi Fransi:

Banque Saudi Fransi is a full service commercial bank with a network of 86 branches in Saudi Arabia as of 2016 year end. Founded in 1977, Banque Saudi Fransi is affiliated with Credit Agricole and offers both conventional and Islamic banking services and products. The Bank operates through four segments: (i) Corporate Banking, (ii) Retail Banking, (iii) Treasury and (iv) Investment Banking and Brokerage. Banque Saudi Fransi is a leading corporate franchise with the 2nd largest market share in corporate lending in Saudi Arabia as of 2016. The Bank has approximately 900 thousands retail clients and 3,600 corporate clients serviced by approximately 3,200 employees.