Riyadh – Mubasher: Molan Steel Company has entered into a formal financing agreement with its principal shareholder, Dar Al Takamul Holding Company, for an interest-free loan totaling SAR 15 million.
The facility is strategically designed to bolster Molan Steel’s financial position in general, according to a bourse filing.
The funding further aims to facilitate upcoming acquisition costs and ensure the continued stability of the listed firm’s ongoing industrial operations.
Molan Steel is a player in the Saudi steel products sector and has secured the financing that is structured as a Qard Hasan, which is a Sharia-compliant interest-free loan, on 13 May 2026.
Under the terms of the agreement, the facility will not incur any interest charges, investment returns, administrative fees, or other financial benefits for the lender, representing a direct injection of liquidity into the company without the traditional costs associated with debt servicing.
A notable aspect of the disclosure is that a substantial portion of this capital has already been utilized by the company. Molan Steel confirmed that roughly SAR 9.13 million had been received in various installments prior to the formal signing of the agreement.
The remaining balance of the SAR 15 million facility will be directed toward covering acquisition-related expenses and meeting the company’s broader operational requirements.
Molan Steel noted that this proactive funding approach suggests a period of ongoing support from the major shareholder to stabilize the company’s cash flows.
With the transaction classified as a related-party agreement, Molan Steel provided a promissory note for SAR 15 million in favor of the lender. This legal instrument serves as the primary guarantee for the facility.
The repayment terms are structured such that the borrowing party is obligated to return the total loan amount upon a formal written demand from Dar Al Takamul Holding.
By securing this interest-free financing, Molan Steel effectively strengthens its balance sheet while avoiding the impact of high borrowing costs in the commercial lending market.
