Acwa Power signed a share purchase agreement to offload 30% of its stake in Rabigh Arabian Water and Electricity (Rawec) to Hassana Investment Company — the investment manager of General Organization for Social Ins. (GOSI) Investment Ventures — for SAR 844 mn, according to a disclosure to Tadawul yesterday. Prior to the transaction, Acwa owned 99% of Rawec.

Ironing out the details: The sale is part of Acwa’s strategy to recycle its capital and optimize its portfolio, the disclosure read. The transaction involves two other entities: Oasis Power One Conventional Energy and Water Company — a wholly owned subsidiary of Acwa — and the buyer, GOSI Investment Ventures. Proceeds from the sale will be used to support Acwa’s ongoing business operations, it added. Additionally, the sale will result in a decrease in the earnings contribution from RAWEC to the overall net income of the group.

About Rawec: Rawec is an independent water, steam, and power producer (IWSPP) that was established in 2005 to build, own, and operate the utilities required for the Rabigh Refining and Petrochemical plant, which is jointly owned by Aramco and Sumitomo Chemical.

A snapshot of the financials: Rawec’s net income dropped 6.7% y-o-y to SAR 358.6 mn in 2023, meanwhile its revenues rose 4.2% y-o-y to SAR 632.8 mn in 2023, according to its financial statement (pdf). Rawec’s asset book value amounts to SAR 731 mn.

MARKET REAX- Acwa’s shares were down 2.5% at market close to reach SAR 407 per share.

IN OTHER M&A NEWS-

Saudi Advanced Industries Company (SAIC) signed a non-binding MoU to acquire up to 100% of Dar Al Balad Business Solutions, it said in a disclosure to Tadawul. The acquisition would, if closed, see SAIC grow and expand Dar Al Balad with an eye to take it public within two years, the disclosure reads. The MoU expires in six months but can be extended by agreement. No further details or financial information was disclosed.

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