DIALOG Group Berhad (“DIALOG”) wishes to announce that on 22 December 2022, its indirect subsidiary, Dialog (Labuan) Ltd (“DLL”) has disposed of its entire 60% equity stake in Dialog Services Saudi Arabia Company Limited (“DSSA”) to Sedres Trading & Maritime Services Co Ltd (“Sedres”) for a total cash consideration of SAR6,600,000 or approximately RM7.7 million (“Sale Consideration”) (“Shares Sale”).
DSSA is principally involved in the contracting of petroleum and petrochemical related works, and trading in specialty chemicals and equipment in Saudi Arabia. DLL is a company incorporated in Labuan, Malaysia and DSSA is a company incorporated in the Kingdom of Saudi Arabia. Sedres had expressed interest to take over DSSA and it is an opportune time for DIALOG to divest its stake in DSSA.
The disposal involves the sale of 1,200 ordinary shares or DLL’s entire 60% equity interest in DSSA.
The Sale Consideration was based on a willing-buyer willing-seller basis, after taking into account DSSA’s unaudited net assets as at 30 September 2022 of SAR11.0 million.
DLL’s original cost of investment in DSSA was SAR1,200,000 (approximately RM1.4 million) which was made in 2006 and the Shares Sale resulted in a no gain or loss to DIALOG. The sale proceeds will be used for working capital purposes.
DSSA will cease to be a subsidiary of DIALOG with effect from the date of the registration of the change of shareholders of DSSA with the relevant authorities in Saudi Arabia, expected to be within 3 months.
DIALOG’s operations in Saudi Arabia will continue under Dialog Jubail Supply Base Company Limited, another company which DIALOG and Sedres has equity stake of 60% and 40% respectively.
The Shares Sale has no effect on the share capital and substantial shareholders’ shareholdings of DIALOG and has no material impact on the earnings, net assets and gearing of DIALOG.
The Shares Sale does not require approvals from the relevant authorities and the shareholders of DIALOG.
None of the directors of DIALOG, major shareholders of DIALOG and/or persons connected with them have any interest, whether direct or indirect, in the Shares Sale.
This announcement is dated 22 December 2022.