Saudi Telecom Company -stc- announces the signing of a Joint Venture Agreement with Public Investment Fund (PIF) to establish a company specialized in the field of Internet of Things (IoT) in KSA

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Announcement Detail	Saudi Telecom Company – stc – announces the signing of a Joint Venture Agreement on 30-03-2022 with Public Investment Fund (PIF) to establish a limited liability company (the New Company) in the field of IoT. The New Company’s business is in line with the expected growth and increasing demand for Internet of Things services and products, it aligns with stc's growth strategy, and Saudi Arabia's Vision 2030 for a connected nation. The New Company will be headquartered in the Kingdom of Saudi Arabia. The New Company’s capital will amount to SAR 492 million upon establishment, with 50% ownership for both stc and PIF. stc will finance its share of this investment, totaling SAR 246 million, from its own resources. The Joint Venture Agreement allows the possibility to increase the New Company’s capital up to SAR 900 million, as needed, and based on the New Company’s business requirements, at the end of the 3rd financial year from establishment, subject to the competent authorities and regulatory approvals. The expected total capital injection will be in accordance with stc and PIF proportionate ownership in the capital of the New Company. The New Company is expected to have a positive overall financial impact on stc. However, it should be noted that whether the parties can proceed as planned is dependent on i) obtaining customary regulatory approvals; and ii) satisfactory completion of the conditions in the Joint Venture Agreement to establish the New Company and the commencement of its commercial operation. It’s worth to mentioned that the Public Investment Fund (PIF) is considered a related party being the largest shareholder in Saudi Telecom Company (stc) and holds 64% of the shares in stc, and the Board of Directors following members have indirect interest as a representative of the PIF: H.E Dr. Khaled H. Biyari, Mr. Yazeed A. AlHumied, Ms. Rania M. Nashar, Mr. Arndt F. Rautenberg and Mr. Sanjay Kapoor. Therefore, this transaction shall be subject to a vote to authorize it from stc’s general assembly (which will be scheduled at a later date) in accordance with the relevant laws and regulations.

Element List

Explanation

Announcement Detail

Saudi Telecom Company – stc – announces the signing of a Joint Venture Agreement on 30-03-2022 with Public Investment Fund (PIF) to establish a limited liability company (the New Company) in the field of IoT. The New Company’s business is in line with the expected growth and increasing demand for Internet of Things services and products, it aligns with stc's growth strategy, and Saudi Arabia's Vision 2030 for a connected nation. The New Company will be headquartered in the Kingdom of Saudi Arabia.

The New Company’s capital will amount to SAR 492 million upon establishment, with 50% ownership for both stc and PIF. stc will finance its share of this investment, totaling SAR 246 million, from its own resources.

The Joint Venture Agreement allows the possibility to increase the New Company’s capital up to SAR 900 million, as needed, and based on the New Company’s business requirements, at the end of the 3rd financial year from establishment, subject to the competent authorities and regulatory approvals.

The expected total capital injection will be in accordance with stc and PIF proportionate ownership in the capital of the New Company.

The New Company is expected to have a positive overall financial impact on stc. However, it should be noted that whether the parties can proceed as planned is dependent on i) obtaining customary regulatory approvals; and ii) satisfactory completion of the conditions in the Joint Venture Agreement to establish the New Company and the commencement of its commercial operation.

It’s worth to mentioned that the Public Investment Fund (PIF) is considered a related party being the largest shareholder in Saudi Telecom Company (stc) and holds 64% of the shares in stc, and the Board of Directors following members have indirect interest as a representative of the PIF: H.E Dr. Khaled H. Biyari, Mr. Yazeed A. AlHumied, Ms. Rania M. Nashar, Mr. Arndt F. Rautenberg and Mr. Sanjay Kapoor. Therefore, this transaction shall be subject to a vote to authorize it from stc’s general assembly (which will be scheduled at a later date) in accordance with the relevant laws and regulations.