Riyadh – Mubasher: Bawan Company said United Transformers Electric Company (Utec Saudi) signed a shares sale contract with Industry Technology Electric Company to sell its entire 49% equity stake in United Technology Electric Company (Utec Algeria) for $8 million or SAR 30 million approximately.

The transaction comes in line with Bawan’s strategy to focus on investments that reduce any potential risks and maximise the stakeholders’ returns, according to a bourse disclosure on Sunday.

The completion of the deal is subject to obtaining all regulatory approvals from relevant authorities. The two parties agreed that the shares sale contract will be effective as of 31 December 2020.

The sale will generate a capital gain to Utec Saudi estimated at about SAR 4.2 million, of which Bawan’s share will be SAR 3.6 million approximately.

Bawan will realise a comprehensive profit of around SAR 1.5 million from this sale after the closing of the foreign currency translation balance by SAR 2.1 million. The financial impact is expected to appear during the first quarter (Q1) of 2021.

In 2014, Utec Saudi, an 85.5%-indirectly owned subsidiary of Bawan, started establishing and managing an industrial limited liability company in Algeria under the name of Utec Algeria.