stc shareholders OK PIF’s acquisition of TAWAL for SAR 8.7B

Shareholders of telecom major stc approved, on July 24, the business and contracts concluded with the Public Investment Fund (PIF), under which the fund will acquire a 51% stake in Telecommunication Towers Co. Limited (TAWAL) for SAR 8.7 billion.

In a statement to Tadawul, stc said TAWAL was valued at SAR 21.94 billion, implying an enterprise value of 100% on a cash-free and debt-free basis.

Meanwhile, additional agreements were signed to transfer the ownerships of TAWAL and Golden Lattice Investment Co. (GLIC) to the new entity, Digital Infrastructure Co.

GLIC owns and operates 8,069 telecommunications towers in the Kingdom. It is owned by the PIF and Prince Saud bin Fahd bin Abdulaziz and Sultan Holding Co. GLIC was valued at SAR 3.03 billion, excluding cash and debt balances.

stc will pump SAR 533 million into Digital Infrastructure’s capital to maintain its ownership at 43.06 %, while the cash consideration paid in favor of stc and the value of capital increase will be subject to change, in accordance with the deal completion mechanism.

Digital Infrastructure will be 53.99% PIF-owned, 43.06% by stc, and 1.48% owned by Prince Saud bin Fahd bin Abdulaziz and Sultan Holding Co. each.

The deal agreements include a number of terms that must be fulfilled, such as obtaining approval from the Communications, Space and Technology Commission (CITC), and another company of a regulatory and commercial nature. These agreements fall within the normal course of business and do not grant any preferential benefits.

stc disclosed that PIF is a related party as it is one of the largest shareholders with a stake of 64% in the telco. Additionally, some members of the board of directors—namely, Khaled Biyari, Yazeed Al Humied, Rania Nashar, Arndt Rautenberg, and Sanjay Kapoor—have indirect interests as they are representatives of the fund.

The shareholders also elected 11 board members for the next four-year term starting from July 25, 2024. The elected members arePrince Mohammed Al-Faisal, Khaled H. Biyari, Yazeed Al-Humied, Ibrahim Al Mojel, Rania Nashar, Sarah Al-Suhaimi, Jameel AlMulhem, Waleed Shukri, Ahmed Al Omran, Arndt Rautenberg and Sanjay Kapoor.