25 Oct

Fitaihi signs the sale contract with Dr. Mohammed Fitaihi

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Element ListIntroduction
ExplanationWith reference to the announcement of Fitaihi Holding Group on Tadawul website published on June 10, 2020, regarding signing a non-binding Memorandum of Understanding with the former board member Dr. Mohammed Ahmed Hassan Fitaihi, to sell the Group’s 80% stake in the capital of its subsidiary (Luxury Goods Trading Company Ltd.) (LGTC) To Dr. Mohammed Ahmed Hassan Fitaihi, and with reference to the announcement of Fitaihi Holding Group on Tadawul website published on July 16, 2020, regarding the results of the Ordinary General Assembly of the Group, held on July 15, 2020, and approved the transactions and contracts that will be concluded between the Company and the former board member Dr. Mohammed Ahmed Hassan Fitaihi, Fitaihi Holding Group announces that it has signed a sale contract with Dr. Mohammed Fitaihi to sell the Group’s 80% stake in the capital of the subsidiary Company.
Date of Announcement of the Award
Explanation2020-07-16 Corresponding to 1441-11-25
Contract Subject Matter
ExplanationSelling of the 80% stake of Fitaihi Holding Group in its subsidiary (Luxury Goods Trading Company Ltd. (LGTC)) to the former member of the board of directors, Dr. Mohammed Ahmed Hassan Fitaihi.
Date of Signing the Contract
Explanation2020-10-25 Corresponding to 1442-03-08
Contract Value
ExplanationThe total value of the sale contract is 14.36 million SAR.
Contract Details
ExplanationSelling of Fitaihi Holding Group’s 80% stake in the share capital of (Luxury Goods Trading Company Ltd.) to the former member of the Board of Directors, Dr. Mohammed Ahmed Hassan Fitaihi, for a total sum of 14.36 million SAR, to be paid as follows:

1- Receiving a cash amount of 10.75 million SAR, from the value of the transaction, representing 74.9% of the total value of the transaction.

2- Obtaining gold and jewelry merchandise, selected by Fitaihi Holding Group, from (Luxury Goods Trading Company Limited) at its fair value, in the amount of 1.27 million SAR which represents 8.8% of the total value of the transaction.

3- Scheduling the payment of the remainder of the transaction value, an amount of 2.34 million SAR, which represents 16.3% of the total value of the transaction, on six installments until 31/12/2022.
Contract Duration
ExplanationA final sale contract
Financial Impact and the Relevant Period
ExplanationThe financial impact of this sale transaction was recorded in the financial results of the Company for the first half of the year 2020, represented in achieving losses from discontinued operations amounting to 6.5 million SAR, as a result of the Group’s resolution to exit and sell its stake in the share capital of the Subsidiary, Luxury Goods Trading Company Ltd.
Related Parties
ExplanationThe former board member, Dr. Mohammed Ahmed Hassan Fitaihi, owns 20% of the share capital of the subsidiary Company (Luxury Goods Trading Company Ltd.) and occupies the position of its general manager.
Additional Information
Explanation1- KPMG Company, an independent party, evaluated the subsidiary company (Luxury Goods Trading Company Ltd.) as of May 31, 2020, based on a mandate from the Board of Directors of Fitaihi Holding Group.

2- The result of this evaluation carried out by KPMG company is that the equity value range of (Luxury Goods Trading Company Ltd.) is between 17 million to 18.9 million SAR, and the evaluation average was adopted.

3- The subsidiary (Luxury Goods Trading Company Ltd.) has been founded by Dr. Mohammed Ahmed Hassan Fitaihi in 2004, to work in the wholesale and retail sector, in precious metals and stones, and owns the brands (Baby Fitaihi), (M. Fitaihi) and (Mamluki). It has 20 branches in the KSA and 2 branches in the UAE.

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