{"id":87332,"date":"2024-06-26T00:00:00","date_gmt":"2024-06-26T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2024\/06\/26\/budget-saudi-subsidiary-one-step-closer-to-acquisition-of-autoworld\/"},"modified":"2024-06-26T00:00:00","modified_gmt":"2024-06-26T00:00:00","slug":"budget-saudi-subsidiary-one-step-closer-to-acquisition-of-autoworld","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2024\/06\/26\/budget-saudi-subsidiary-one-step-closer-to-acquisition-of-autoworld\/","title":{"rendered":"Budget Saudi subsidiary one step closer to acquisition of AutoWorld"},"content":{"rendered":"

Shareholders of Tadawul-listed United International <\/strong>Transportation<\/strong> (Budget Saudi) have <\/strong>signed off on a 9.8% capital hike to SAR 781. 7 mn through an issuance of new shares <\/strong>to finance the company\u2019s takeover of AutoWorld<\/a>, according to a disclosure to Tadawul<\/a>. The board of Budget Saudi recommended earlier this month<\/a> the capital increase to fund the full acquisition of AutoWorld. The disclosure doesn\u2019t offer a timeline for the completion of the transaction. <\/strong><\/p>\n

What we know: <\/strong>The Tadawul-listed rental firm is grabbing 100% of Autoworld through a share swap that will see it issue 7 mn new shares to the latter\u2019s owner, Sedco Holding<\/a>. Sedco is a Shariah-compliant investment firm with holdings in asset management, education, healthcare, hospitality, and real estate. The acquisition will see AutoWorld\u2019s shares transferred from Sedco Holding to Budget Saudi\u2019s subsidiary Aljozoor Alrasekha Trucking (Rahaal). This will see Sedco Holding\u2019s direct and indirect ownership reach 8.96% of Budget Saudi.<\/p>\n

About AutoWorld: <\/strong>Established in 1981, AutoWorld specializes in operational leasing and fleet management. It provides holistic mobility services to government organizations and businesses across the Kingdom in industries such as oil and gas, logistics, and FMCG.<\/p>\n

The rationale: <\/strong>Budget Saudi said the acquisition will help it consolidate its base as market leader in the vehicle and leasing market in the Kingdom, according to a statement<\/a>. It will help boost its market share to 18% from a current 12%, bringing its total car leasing fleet to c. 49.3k (including AutoWorld\u2019s 14k vehicles), the rental firm said, citing an unnamed third-party market report.<\/p>\n

With more plans in the works: <\/strong>Budget Saudi said it plans to merge its short-term vehicle rental unit Payless with AutoWorld to \u201ctap into more price-conscious customers, including residents, business travelers, and leisure travelers, further diversifying and growing its customer portfolio.\u201d<\/p>\n

What they said:<\/strong> \u201cThis deal, the first of its kind in Budget Saudi's history, enables us to lay the groundwork for strategic initiatives that drive sustainable growth, enhance competitiveness, and create shareholder value.\u201d Budget Saudi President and Group CEO Fawaz Danish said.<\/p>\n

Budget Saudi has been busy:<\/strong> Budget Saudi\u2019s Rahaal signed in April<\/a> a sale and purchase agreement to acquire a 70% stake in UAE freight forwarder Overseas Development \u2019s subsidiary in the UAE. The transaction was valued at AED 13.3 mn (c. SAR 13.6 mn). It acquired in November a 70% stake in Overseas Development\u2019s Saudi subsidiary, having inked back in July 2022 an MoU that could also see it take a stake of the same size in Overseas\u2019 Kuwait unit.<\/p>\n","protected":false},"excerpt":{"rendered":"

Budget Saudi said the acquisition will help it consolidate its base as market leader<\/p>\n","protected":false},"author":1,"featured_media":87333,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[2575],"tags":[1781,10,14],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-87332","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-ma-watch","tag-aljozoor-alrasekha-trucking-rahaal","tag-enterpriseam-ksa","tag-ma-watch","wpautop","entry"],"acf":{"mongo_id":"2850f996-e6c7-4848-aacb-e0cb87899e17","order":"6","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/6\/1638.jpg","photo_position":"above","homepage_title":"","full_issue_title":"Shareholders of Budget Saudi approve capital increase for acquisition of AutoWorld","related_issue":[87321],"teaser":"Budget Saudi said the acquisition will help it consolidate its base as market leader","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2024\/6\/.94e62a39-8ee7-4060-99f0-067f1cbc2806.mp3"},"yoast_head":"\nBudget Saudi subsidiary one step closer to acquisition of AutoWorld - 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