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Saudi's Ma'aden will buy 85% of Meridian [representational image].
Saudi miner buys 85% of Meridian, which distributes 500,000 t of fertiliser across Malawi, Mozambique, Zimbabwe, and Zambia
Saudi Arabian Mining Company (Ma’aden) has inked a deal to buy fertiliser distribution firm Meridian in what is the group’s first international acquisition as it bolsters its market share in Africa.
According to a filing on Saudi bourse Tadawul, Ma’aden signed a binding agreement to buy 85% of the Mauritius-based firm on 18 April. The deal is subject to regulatory approval and “other customary conditions”, and is expected to close in Q3 2019.
The reaming 15% stake, Ma’aden said in its bourse missive, is expect to be acquired over the next four years.
HSBC acted as Ma’aden’s financial adviser on the deal, and Baker McKenzie was the Saudi company’s legal advisor for this pioneering acquisition.
Private equity investors, as well as minority shareholders, currently own Meridian, which is valued at $140m (SAR525m). It distributes close to 500,000 tonnes of material across Malawi, Mozambique, Zimbabwe, and Zambia.
According to the Ma’aden statement, the all-cash deal will provide the phosphate producer 3,000 staff and a network of operations to expand in Africa.
Phosphate is used to produce fertiliser that is essential for replacing the phosphorous mineral that is removed from soil when agricultural plants are harvested.
Darren Davis, Ma’aden’s chief executive officer and president, described the acquisition as a “very important step in Ma’aden’s strategy to build global distribution channels for our fertiliser products”.
Hassan Al-Ali, senior vice president for phosphate at Ma’aden, added: “This transaction will provide us with logistics advantages in Southeast Africa, and greater knowledge of on-the-ground customer requirements, both of which will be instrumental in better serving our customers.”
The Story of Ma’aden
According to its website, Ma’aden is now among the fastest growing mining companies in the world and the largest multi-commodity mining and metals company in the Middle East. The introduction to the company, explains ow it has come a long way since 1997, when Ma’aden established by Royal Decree with a mandate to develop Saudi Arabia’s minerals sector as the third pillar of Saudi industry, beyond oil and petrochemicals.
Ma’aden was wholly owned by the Saudi Government until 2008 when 50% of its shares were floated on the Saudi Stock Exchange (Tadawul). Today, Ma’aden is ranked among the top 10 global mining companies based on market capitalisation.
After investing significant effort, time and resources in building a world-class, unique and fully integrated mining value chain, adds the same source, Ma’aden is now focused on marketing our products worldwide, improving the return on our investments and consolidating our resources and experience – even as it continues to develop new locations and build new industrial plants.
In the 20 years since its foundation, Ma’aden has focused on gold, phosphate, aluminium, industrial minerals and copper. In the process, we have: