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SIDF activates loan guarantees: Saudi Industrial Development Fund (SIDF) notified Jazan Development and Investment Company (Jazadco) and Artex Industrial Investment Company it is activating guarantees for a SAR 672 mn loan made to Al Reef Sugar Refinery Company (Resreco) after the firm failed to meet repayment obligations, according to two separate disclosures (here and here) from the guarantors. Jazdaco and Artex had each guaranteed 15% of the loan, equivalent to SAR 100.8 mn each, the disclosures said. The guarantors also hold 15% each in Resreco, Argaam said.
What’s next? Both guarantors have a one-month period to make good on their guarantees, according to Article 13 of State Revenue Law (pdf). Jazadco and Artex notified Resreco’s board to commission an independent valuation of Resreco’s assets, with Jazdaco also stepping in to assist in finding buyers so as to pay down parts of the outstanding guarantees. Meanwhile, the guarantors will negotiate with the SIDF on a “mutually agreeable payment plan.” The impact on both firms’ financials will be disclosed following the conclusion of these two steps, the disclosures added.
About Al Reef Sugar: The Jeddah-based sugar refinery was established in 2015 to produce 1 mn tons of sugar a year, with a view to help meet national demand while exporting the surplus to neighboring markets, as per its LinkedIn page.
