TADCO Sells 286K Horizon Food Shares, Books SAR 1.06M Loss

Tabuk Agricultural Development Co. (TADCO) offloaded 286,250 shares of Horizon Food Co., booking a SAR 1.06 million loss on the sale. The transaction, executed through negotiated deals on March 31, 2025, reduces TADCO’s stake in the food company from 1.14% to 0.57%. The proceeds will cover part of the company’s obligations and operating expenses, according to the disclosure.

The sale happened in two blocks. The first block of 200,000 shares went at SAR 35 per share, generating SAR 7 million. The second block of 86,250 shares sold at SAR 34 per share, adding SAR 2.9325 million. Total proceeds reached SAR 9.9325 million. The loss of SAR 1.06 million implies a carrying value above the sale prices, meaning TADCO exited the position below its book cost.

The Transaction: Two Blocks, SAR 9.93M Proceeds

TADCO structured the exit through two negotiated deals, not open-market sales. The first tranche of 200,000 shares cleared at SAR 35, while the second, smaller tranche of 86,250 shares moved at SAR 34. The blended average price works out to roughly SAR 34.68 per share. The SAR 1.06 million realized loss suggests TADCO’s average cost basis was closer to SAR 38.40 per share, though the company did not disclose the exact carrying value.

The use of negotiated deals indicates a pre-arranged buyer, likely an institutional counterparty or a related party. This method avoids the price impact that an open-market block of this size could cause in a thinly traded stock. Horizon Food’s liquidity profile is not detailed in the disclosure, however the decision to use negotiated deals points to a deliberate effort to secure a clean exit without disrupting the market.

Why TADCO Sold: Covering Obligations and Operating Expenses

The stated reason for the sale is straightforward: TADCO needed cash to meet obligations and fund operating expenses. The company did not specify which obligations, leaving room for interpretation. Agricultural companies in Saudi Arabia have faced margin pressure from input costs, and TADCO’s decision to liquidate a financial investment rather than core operating assets suggests the cash need was immediate.

The sale reduces TADCO’s investment portfolio, which may have been a source of non-operating income. Horizon Food, a Saudi-listed food producer, likely provided dividend income or potential capital appreciation. By cutting the stake to 0.57%, TADCO essentially exits any meaningful influence or financial benefit from Horizon Food’s performance. The remaining 0.57% is a residual position that may be sold later if cash needs persist.

Q2 2025 Earnings Hit and Remaining Stake

The financial impact of the SAR 1.06 million loss will appear in TADCO’s Q2 2025 results. For a company of TADCO’s size, a SAR 1.06 million loss is material enough to affect quarterly net income. The loss will flow through the income statement as a realized loss on investments, reducing reported earnings. Investors should adjust their Q2 estimates accordingly.

After the sale, TADCO retains a 0.57% stake in Horizon Food. That residual holding could still generate a small dividend stream, however the company has signaled that its priority is liquidity, not investment returns. If TADCO faces further cash pressure, the remaining shares could be sold, potentially triggering another small loss if the market price stays below the carrying value.

TADCO’s Liquidity Picture After the Horizon Food Exit

The sale of a financial asset to cover operating expenses raises questions about TADCO’s broader liquidity position. The company did not disclose its current cash balance or debt obligations in the sale announcement. The decision to sell an investment at a loss rather than borrow or use internal cash suggests that either credit lines are constrained or management prefers to avoid additional debt.

TADCO’s core business is agriculture, a sector with seasonal cash flow swings. The timing of the sale, at the end of Q1 2025, may be tied to working capital needs ahead of the planting or harvesting season. Without more detail, the transaction serves as a data point that TADCO is managing cash tightly. The next catalyst will be the Q2 2025 earnings report, where the loss will be quantified and management may provide additional commentary on liquidity and any further asset sales.

For Horizon Food, the sale reduces a known shareholder’s stake but does not change the company’s operations. The negotiated-deal structure suggests the buyer was willing to absorb the block without demanding a discount that would have widened TADCO’s loss. That buyer now holds a larger position, which could be a signal of confidence in Horizon Food’s outlook, though the identity remains undisclosed.

For broader context on Saudi food-sector investments, see our analysis of Foods Gate’s 10% Cash Dividend. The transaction also echoes other Saudi corporate restructurings, such as the SAR 252M ZODCON deal that set up a Q4 2026 catalyst for SENAAT.

The TADCO sale is a small but telling event. It shows a company prioritizing immediate cash needs over investment portfolio returns, and it sets up a Q2 earnings report where the realized loss will directly hit the bottom line. The remaining 0.57% stake is a footnote unless further sales materialize.