Amiantit to close Saudi companies amid infra project 'slowdown'
Dammam-based group to shut pipeline and concrete supply units as accumulated losses since 2016 hit $137m
Saudi Arabia’s Amiantit Group has announced the shutdown of two units after posting $137m (SAR514.4m) in accumulated losses from 2016 to date.
According to a 21 February, 2019 missive on Tadawul, the company’s Ameron Saudi Arabia business in Dammam, and the Jeddah-based Saudi Arabia Concrete Products, will be closed.
The Dammam company is a manufacturer of water transmission and distribution systems, while the Jeddah outfit manages concrete supply. Ameron’s closure will result in a loss of $2.3m (SAR8.6m), while the concrete company’s shutdown will have a negative financial impact of $1.4m (SAR5.4m).
On 20 February, Amiantit Group said its accumulated loss was partly a result of “the continuation of the decline or slowdown in the infrastructure projects in [Saudi Arabia] during [...] 2016 and 2017”.
Amiantit added that its board had also recommended a capital reduction from $308m (SAR1.15bn) to $170.8m (SAR640.6m).
The Dammam and Jeddah companies’ closure will not significantly impact liabilities or operations, Amiantit said, adding that it expected the capital restructuring to “have a positive impact on the group’s financial performance”.
This is not the first time that financial headwinds have driven a restructuring operation at the Dammam-based group. In November 2011, Amiantit closed down three production lines in Bahrain due a slump in demand.