Ratnamani Metals & Tubes Limited (RMTL) has entered into a joint venture agreement with Saudi Electric Supply Company Limited (SESCO), a Tamimi Group company, to establish a manufacturing unit for seamless tubing products in Saudi Arabia. RMTL will hold a 75% stake in the joint venture company, while SESCO will hold the remaining 25%, according to a press release issued by Ratnamani.
The new company, to be incorporated within three months, will be based in Dammam or another location in Saudi Arabia. The joint venture will focus on manufacturing seamless steel tubes and pipes that are currently imported into the region. The products will serve the oil and gas, petrochemicals, heavy industries, and infrastructure sectors in Saudi Arabia, the Gulf Cooperation Council (GCC) region, and other markets based on demand.
The equity shares in the new entity will be issued at a face value of SAR 10 per share, with Ratnamani subscribing to its stake in cash. Upon incorporation, Ratnamani will nominate three directors and SESCO will nominate two directors to the joint venture’s board.
The company stated, “The purpose of the proposed JV Company is to provide the critical tubing solutions to the consumers in the Kingdom of Saudi Arabia (KSA) / Gulf Co-operation Council (GCC) Countries and even to the rest of the world on opportunities basis.”
SESCO, which operates in supply chain services for process industries, will assist the joint venture with market assessment, project implementation, and compliance support within Saudi Arabia through its group companies.
Ratnamani noted that the agreement does not impact the management or control of the listed entity and does not fall under related party transactions. Further details regarding the subsidiary will be disclosed upon incorporation.