RIYADH: Prince Alwaleed bin Talal, chairman of Kingdom Holding Company (KHC), announced on Monday that the value of his recently transferred Citigroup shares to the ownership of KHC had appreciated by SR300 million.
“Due to appreciation of the shares from $3.31 to 3.7 on Jan. 5, the value of the newly transferred shares have gone up by SR300 million for the benefit of KHC,” Prince Alwaleed told reporters in Riyadh on Monday.
The company’s investment in Citi is worth some $4.3 billion, based on Citigroup’s closing price on Friday. Kingdom also holds investments in real estate, property and equipment and intangible assets estimated at $7.1 billion by end-September.
Prince Alwaleed said the immediate financial benefit to KHC shareholders at the time of transfer was SR2.24 billion and the company would realize an additional benefit of SR675 million for every $1 increase for the share price of Citigroup.
KHC will call for an extraordinary general meeting of its shareholders to approve the reduction of the company’s capital from SR63 billion to SR37.5 billion (a share for every 1.7 share).
The prince said that the higher share price and the increased value of its assets would empower KHC to borrow additional funds, if needed. “We have plans to expand our network of projects at regional and global levels,” he said.
The prince said KHC’s capital reduction led to the removal of all accumulated losses from equity. “This is the first positive result of capital reduction.”
The initiative will lead the company to profitability and enable the KHC to distribute dividends to shareholders once approved by KHC’s board of directors and will allow the company to improve its position and increase future borrowing capacity.
Prince Alwaleed said the company would announce its fourth quarter results in two weeks, noting that the first, second and third quarters were all positive. “We hope that this trend will continue for the final quarter as well.”