Tabuk Agricultural Development Company announced the sale of a portion of its investment in Afaq Food Company. In its official statement, the company clarified that it sold 314,250 shares at SAR 35 per share, bringing the total value of the transaction to approximately SAR 10.9 million, after deducting expenses related to the sale. This strategic move resulted in a book loss, reflecting the company's efforts to restructure its investment portfolio.
The historical context of Tabuk Agricultural Development Company's role in food security
Tabuk Agricultural Development Company was established in the early 1980s as a cornerstone of the Kingdom's vision for achieving food security. Over the decades, the company has actively contributed to the development of the local agricultural sector by producing wheat, fruit, and animal feed, adopting the latest agricultural technologies. Its investment in promising companies like Afaq Food is part of its expansion strategy to diversify income sources and reduce reliance on traditional agricultural activities. These moves are part of adapting to the economic transformations taking place in the Saudi market, particularly in light of the modern directives of Saudi Vision 2030, which emphasizes resource sustainability and enhancing the efficiency of national companies.
Details of the book losses and the financial impact of the transaction
In its statement published on the Saudi Stock Exchange (Tadawul) website, the company clarified that the book loss resulting from the first transaction is approximately SAR 942,750. This loss stems from the difference between the sale price of SAR 35 and the book value per share of SAR 38, according to the company's latest published annual financial statements for the year ending 2024. Management emphasized that these losses are purely accounting (non-cash) and do not affect the company's actual cash flows. On the contrary, these transactions contributed to an immediate cash injection, which supports future operational and agricultural plans. The financial impact of these transactions is expected to be reflected in the financial statements for the period ending March 31, 2026.
Completion of the exit plan and its impact on the local market
In a related development, the company announced the execution of an additional sale transaction involving 228,500 shares of its investment in Afaq Food at the same price (SAR 35 per share), for a total value of approximately SAR 7.9 million before expenses. This transaction was executed with multiple buyers through separate purchase offers. These successive steps complement the previously announced strategic plan to sell up to one million shares of its stake in the aforementioned company.
This trend is of great importance domestically, reflecting the dynamism of the Saudi financial market and the ability of listed companies to efficiently liquidate their assets to support their core operations. Furthermore, directing this liquidity towards operational and agricultural activities will enhance the company's capacity to meet the growing domestic demand for agricultural products, thereby supporting the stability of food supply chains in the Kingdom and creating new investment opportunities in the economic and agricultural sectors.
