Jarir Marketing Co. Announces Sale Residential, commercial and office building owned by the company, located in Al Rakah Al Janoubia district in Al Khobar Governorate in the value of 178,000,000 SAR

12-May-2022

ELEMENT LIST	EXPLANATION
Introduction	Jarir Marketing Company announces the sale of the building owned by it, located in Al Rakah Al Janoubia district in Al Khobar Governorate. It consists of eight floors, and includes residential, commercial and office areas, in addition to Jarir Bookstore showroom.
Transaction Details	A sale contract that includes the leaseback of the exhibition dedicated to Jarir Bookstore showroom.
Transaction Value	178,000,000 SAR
Transaction Terms	1. Sale price: (178,000,000) one hundred and seventy-eight million Riyals, excluding real estate tax. 2. Jarir Marketing Company (the seller) is to lease back the showroom designated as Jarir Bookstore, of an area ​​(4,101) square meters, for a period of twenty-five years, including non cancellable seven years, For an annual rent of (3,444,840) riyals, with an increase of (5%) every five years.
Parties of the Transaction	1- Jarir Marketing Company (the seller). 2- One of Riyad Capital Funds (the buyer).
Transaction Funding Method	Do not apply
Transaction Execution Date	2022-05-11 Corresponding to 1443-10-10
Description of the Business of the Asset forming the Subject Matter of the Transaction	Residential, commercial and office building
Asset Book Value	166,425,000 SAR
Financial Statements for the Last Three Years of the Asset forming the Subject Matter of the Transaction	Attachement
Transaction reasons	1. The sale is consistent with the company's current strategy to disposal of large real estate and focus on the company's main activity. 2. The sale achieves a better return for the company than maintaining its ownership of the real estate, as it will result in an improvement in the in the retern on the company's assets.
Expected Impact of the Transaction on the Company and Its Operations	1- The cessation of rental income from the property. 2- Cessation of the depreciation of the property . 3- Payment of rent for Jarir Bookstore showroom . 4- Using the proceeds of sale in the company's activities, which is expected to improve return on the company's assets. 5- Recognition of capital gain of around SAR 10 million (adjusted for the unrecognized postion related to the right of use of the showroom being leased back).
Details of Using The Proceeds of the Asset Sale	The proceeds from the sale will be used in Financing the operating activities of the company.
Related Parties	There are no related parties in the sale.
Attached Documents