Shareholders of the Saudi-listed United International Transport Company (Budget Saudi) have approved raising capital by issuing new shares for the acquisition of Al Jazira Equipment Company (AutoWorld), a vehicle leasing unit of Saudi firm SEDCO Holding.

Following approval, 7 million ordinary shares will be issued by Budget Saudi to SEDCO Holding, representing 8.96% of Budget Saudi’s share capital after the capital increase. The shares are expected to start trading on the Saudi Exchange upon completion of the necessary procedures.

AutoWorld’s shares will be transferred from SEDCO Holding to Aljozoor Alrasekha, a Budget Saudi wholly owned subsidiary.

 “The strategic acquisition of AutoWorld provides a robust platform for future growth opportunities, bolstered by the strong KSA real economy, structural changes in the transportation sector, and the flourishing tourism industry,” Fawaz Danish, President & Group CEO, Budget Saudi, said.

Post-acquisition, Budget Saudi plans to merge its Payless brand, a short-term car rental business with AutoWorld to tap into more price-conscious customers.

The car rental and vehicle leasing company said this acquisition reinforces its market share in the business-to-business (B2B) and business-to-government (B2G) segments, where the company foresees significant growth potential driven by a market shift from asset ownership to usership models.

The acquisition is also set to expand Budget Saudi’s customer base, granting access to new customers in industry verticals such as oil and gas, among others where AutoWorld has a presence.

(Writing by Bindu Rai, editing by Daniel Luiz)