Latest news with #Cenomi
Arabian Post
2 days ago
- Business
- Arabian Post
Al‑Futtaim's Strategic Entry Reshapes Cenomi Retail
Arabian Post Staff -Dubai Al‑Futtaim Retail has agreed to acquire a 49.95 per cent stake in Cenomi Retail from major shareholders for about SAR 2.52 billion, signalling a major strategic shift in Saudi Arabia's retail sector. The agreement, unveiled through a statement on Tadawul today, July 20, 2025, also includes a conditional shareholder loan to boost Cenomi's balance sheet. Under the share purchase agreement signed on July 18, Al‑Futtaim would purchase approximately 57.33 million shares from the Alhokair family, Saudi FAS Holding and FAS Real Estate at SAR 44 per share. Completion hinges on regulatory clearance and execution of a parallel SAR 1.3 billion loan agreement aimed at shoring up working capital. ADVERTISEMENT Al‑Futtaim, a UAE conglomerate with a broad portfolio spanning franchising, automotive, real estate and financial services, brings deep retail expertise and a strong track record with global brands. Its investment is expected to stabilise Cenomi's liquidity, support operational continuity and bolster its capacity for expansion. Cenomi Retail, part of Fawaz Abdulaziz Alhokair Co., has navigated a challenging turnaround. It holds the largest brand portfolio in Saudi Arabia, operating over 800 stores across eight countries and managing more than 85 international brands, including Zara under a long-term agreement with Inditex. The firm successfully launched a landmark Zara concept store in Riyadh in December 2024, integrating digital and physical retail channels. Despite these strengths, Cenomi has suffered persistent financial strain. It reported a SAR 1.1 billion net loss in 2023 amid deteriorating margins, asset write-downs and weakening equity. Total assets collapsed by 36 per cent to SAR 4.6 billion by end‑2024, while shareholder equity turned negative – warning signs that triggered restructuring efforts in 2024. In response, Cenomi embarked on an aggressive restructuring: disposing of non-core brands and outlets, offloading 16 franchises in early 2024, divesting five further brands with 121 stores to Abdullah Al Othaim Fashion Co. in October, and appointing Salim Fakhouri as CEO. The divestments, totalling SAR 2 billion, aimed to streamline operations around 'champion' brands like Zara. By mid‑2024, losses had mounted to SAR 1.5 billion. Earlier this month, Cenomi confirmed it was in talks to bring in a strategic investor for nearly half its capital, accompanied by a shareholder loan. Today's announcement reveals that investor as Al‑Futtaim, although final terms on the loan are still under discussion. The deal aligns with broader growth trends in Saudi Arabia's retail sector, which is projected to expand at roughly 7.1 per cent CAGR through 2029. Economic diversification under Vision 2030, expanding consumer spending and rising tourism are driving omnichannel retail innovation. Cenomi's launch of cenomi. com and its O2O model position it to capitalise on these trends, though profitability remains a concern. Analysts have flagged Cenomi as a high-risk, high-reward prospect. With a forward P/E of around 14.3x and a weak operating margin, its distressed balance sheet raises concerns over equity dilution. However, sustained operational cash generation—SAR 1.3–1.4 billion annually—suggests underlying business viability. Al‑Futtaim's entry provides a critical capital injection that could stabilise Cenomi's finances and underpin its digital expansion. Industry observers note that Majid Al Futtaim and Emaar have successfully executed omni-channel models in the region; Al‑Futtaim's deep supply chain know-how and brand partnerships could replicate that success in Saudi markets. Following deal closure, which remains subject to approvals, Al‑Futtaim will command nearly half of Cenomi's share capital and will have extended a substantial shareholder loan. The injecting of both capital and expertise is expected to bolster Cenomi's capability to restore profitability and reclaim market leadership.
Zawya
04-06-2025
- Business
- Zawya
Simah Rating Agency (Tassnief) assigns 'A-' solicited national scale entity ratings to Arabian Centres Company
Riyadh: Tassnief has assigned long-term national scale entity rating of '(A-)'' (Single A Minus) and short-term entity rating of 'T-3' to Arabian Centres Company ('Cenomi' or 'the Company'). The assigned ratings reflect high creditworthiness, thus low credit risk. Risk profile may exhibit variation due to changes in economic and sector conditions. Rating Rationale: The assigned ratings incorporate Cenomi's leading market position, satisfactory business diversity, strong operating performance supported by high occupancies and footfall growth as well as sound tenant mix comprising renowned local, regional and international brands. Ratings also reflect a favorable operating environment which is expected to support operating performance over the rating horizon. Ratings are constrained by aggressive financial and development policies and weak credit metrics, although improvement in the same is expected when Jawharat Riyadh and Jawharat Jeddah are at full stabilization, generating incremental EBITDA of over SAR 650m. Cenomi has a leading market share of approximately 18% in Gross Leasable Area (GLA), three times that of its nearest competitor, underscoring its scale advantage and operational depth in a fragmented market. Cenomi's market leadership offers strong pricing power, high tenant retention, and resilience to competitive pressures. The Company's competitive advantage and strong operational performance emanates from its high-quality malls' portfolio, having strategic composition and broad geographical footprint, although some revenue concentration is present in tier-A malls. The key business risk factors include i) half of the malls built on leasehold land which expose the Company to lease non-renewal risk, and ii) sizeable lease expiries due in 2025. Tassnief expects revenue loss due to lease expiry risk to remain manageable over the rating horizon, while ongoing expansion will further strengthen its market position and enhance revenue diversity. Moreover, comfort is drawn from strong track-record of client lease renewals and historically high tenant retention. Assessment of financial risk profile reflects aggressive financial and development policies which have resulted in weakening in credit metrics and deterioration in working capital cycle, as evident from cashflow from operations (CFO) having remained consistently lower than Funds Flow from Operations (FFO) over the last 3 years. Full recovery in credit metrics is expected to materialize by 2028 where we expect the full EBITDA impact of Jawahrat Jeddah and Jawahrat Riyadh to be reflected in financials. Tassnief is incorporating improved credit metrics while assigning the current ratings. Both malls are expected to contribute SAR 650m in new cash flows at stabilization. Rating Triggers Negative rating triggers include Any further weakening in FFO-based interest coverages from around current level. Further increase in Net Debt to EBITDAR from the current level of 7.51x. Non-materialization of improvement in FFO-based interest coverages and Net Debt to EBITDAR post-stabilization of Jawahrat Jeddah and Jawahrat Riyadh. Continued deterioration in working capital, resulting in lower CFO generation as compared to FFO. Significant weakening in operating performance through decline in occupancies levels below 90%. Deterioration in operating environment, which Tassnief does not anticipate in its base case scenario. Positive rating triggers include A sustained shift towards a balanced financial policy, resulting in notable improvement in debt and interest coverages. Improvement in occupancies levels above 95% following the stabilization of Jawahrat Jeddah and Jawahrat Riyadh. Improvement in FFO based interest coverages to around 2.75x and Net Debt to EBITDAR to below 5x on a sustainable basis. About the Company: Arabian Centres Company, referred to as "Cenomi" or "the Company", is a Saudi Joint Stock Company registered in the Kingdom of Saudi Arabia under the commercial registration number 1010209177. Cenomi is the largest owner, operator and developer of contemporary lifestyle malls in Saudi Arabia. For further information on this rating announcement, please contact Mr. Talha Iqbal (Ext. 6627) at +966-112506627 or email at RS@ Rating Methodology for Corporate (v.2. 2019) can be found on the website:
Argaam
05-05-2025
- Business
- Argaam
Cenomi to kick off tie-up with Westfield with 3 malls in early 2026: Official
Bruno Wahba, Chief Operating Officer at Arabian Centres Co. (Cenomi Centers), said that the partnership with Westfield will begin with launching three malls in early 2026, namely Jewel of Riyadh, Jewel of Jeddah, and Nakheel Mall in Dammam. He told Al Arabiya TV that the partnership with Westfield includes launching the Westfield brand across up to eight Cenomi Centers malls. Wahba also stated that the partnership also includes Cenomi's access to Westfield's tenant network, enabling it to bring in new global brands and provide full support across all value chain functions. Furthermore, Cenomi will leverage the partnership by increasing the leasable area in addition to other revenues, enhancing visitor experience to align with the leading global experience, and accessing the global advertising platform Westfield Rise, where major global companies and brands display their advertisements in malls, he added. According to Argaam 's data, Cenomi Centers signed today an exclusive 10-year strategic partnership and franchising agreement with Unibail-Rodamco-Westfield (URW), with an option to extend the agreement for an additional decade. Under the partnership, Cenomi will be granted exclusive licensing rights to the Westfield brand in Saudi Arabia.
