Saudi-based National Agricultural Development Company’s (Nadec) board has recommended a capital increase through a rights issue worth 2 billion Saudi riyals ($533.24 million). 

The capital hike will help fund the company’s strategic and operational plan and support future activities, the dairy and juice producer said in a statement published on the Saudi stock exchange on Tuesday.

Riyad Capital, the investment arm of Riyad Bank, has been appointed the financial advisor for the rights issue.

The company will issue a statement after submitting the capital increase file with the Saudi market regulator, Capital Market Authority. 

However, the capital increase hangs on approval from competent authorities and shareholders. 

In January, Nadec announced plans to become a vertically integrated food business to reach 6 billion Saudi riyals ($1.59 billion) revenue by 2027.

The firm aims to expand in the vegetables and fruits sector and boost contract farming with large- and small-scale farmers to provide high-quality crops to customers around the Kingdom as part of its 2023-2027 strategy.

(Editing by Seban Scaria seban.scaria@lseg.com )