In a strategic move aimed at strengthening employee loyalty and linking their interests to the company's future performance, the Board of Directors of ACWA Power, during its meeting held on January 22, recommended approving the repurchase of a number of the company's ordinary shares. The recommendation included the purchase of 1.19 million shares, to be held as treasury shares and allocated to the long-term employee incentive program.
Purchase and financing details
In an official statement published on the Saudi Stock Exchange (Tadawul) website on Sunday, the company clarified that the targeted percentage of treasury shares to be purchased represents approximately 0.11% of the total share class being acquired. ACWA Power confirmed that the purchase will be fully financed through its own resources and available cash, reflecting the company's strong financial position and its ability to efficiently manage its cash flow without needing external financing.
Context of the event and ACWA Power's position
This move comes as ACWA Power continues to solidify its position as one of the world’s leading companies in the development, investment, and operation of power generation and desalination plants. The company plays a pivotal role in achieving the goals of Saudi Vision 2030, particularly in the renewable energy and green hydrogen sectors. Investing in human capital through long-term incentive programs (ESOPs) is a global practice adopted by major companies to retain leadership and technical talent and ensure continued sustainable growth by giving employees a sense of ownership and partnership in success.
Procedures and required approvals
The company indicated that the implementation of this decision is not immediate, but rather subject to a number of strict regulatory procedures. The recommendation will be put to a vote by an extraordinary general assembly, the date of which will be announced later. This is in compliance with the requirements of paragraph 4 of Article 17 of the Implementing Regulations of the Companies Law pertaining to listed joint-stock companies. The company also noted the necessity of fulfilling the solvency requirements stipulated in paragraph 3 of Article 17 of the same regulations, in addition to obtaining all necessary approvals from the relevant authorities before commencing the acquisition process.
Expected impact
This decision is expected to enhance job stability within the company, positively impacting operational performance and the execution of the large-scale projects it manages both domestically and internationally. Furthermore, using available cash to repurchase shares sends positive signals to investors regarding management's confidence in the company's future cash flows and the strength of its financial position in the market.
