Yanbu Cement Names Elkhereiji Chairman, Abaalkhail Vice Chairman

Yanbu Cement Co. appointed Mohamed Elkhereiji as chairman and Riyad Abaalkhail as vice chairman at a board meeting on July 6. The board also named a secretary, though the company did not disclose the individual in the same statement.

The leadership change arrives as Yanbu Cement prepares for a shareholder vote on a major capital structure decision. In May, the board proposed liquidating a SAR 787.5 million statutory reserve to increase distributable cash. Shareholders will vote on the proposal at an extraordinary general assembly on Nov. 21.

Elkhereiji and Abaalkhail will oversee that vote and the subsequent deployment of any freed-up cash. The reserve liquidation, if approved, would give Yanbu Cement more room to pay dividends or fund reinvestment. The company has not signaled a change in dividend policy beyond the proposal.

Under Saudi company law, statutory reserves are built from annual profits and can be liquidated only by shareholder vote. Yanbu Cement's proposal would unlock cash that is currently locked in the reserve. The new board leadership will have a direct hand in deciding how that cash is used, assuming the EGM passes the measure.

Yanbu Cement has been dealing with margin pressure from rising fuel and logistics costs even as Saudi Arabia's construction sector stays active. Revenue grew. Margins tightened. The new chairman and vice chairman will set the strategic direction on cost management and capital allocation.

The board secretary appointment is a routine governance step. Saudi corporate governance rules require a board secretary for Tadawul-listed companies. Yanbu Cement did not name the secretary in the announcement.

The Nov. 21 meeting will be the first major test for the new board leadership. Yanbu Cement shares closed flat on the day of the announcement. The company has a market capitalization of about SAR 4.5 billion and trades at a price-to-earnings multiple near the sector average.