Red Sea Housing Services Company Ltd. appoints Saudi Hollandi Bank as lead underwriter and flotation manager

The agreement between RSH and SHB was signed today at an official ceremony in Jeddah by Mr. Jamal Dabbagh, General Manager of RSH and a Director of Dabbagh Group, the parent company of RSH, and Mr. Mr. Suleiman Al-Suhaimi, Chairman of SHB in the presence of Mr. Mark Hanson , Head of Corporate Finance at SHB and Mr. Tahir Al-Dabbagh, General Manager Western Region at SHB. Also present at the ceremony were M. H. Jazeel, Chief Financial Officer of Dabbagh Group, and Ribal Mehio, Vice President of Swicorp, the Financial Advisor to RSH. The IPO is expected to take place in the first half of 2006, contingent upon the approval of the Capital Market Authority ("CMA") and the Ministry of Commerce and Industry ("MoCI"). RSH intends to offer 30% of its shares to the public.

"RSH's decision to pursue a public offering is driven by strong demand for its quick and durable housing solutions in the thriving Oil & Gas, Mining and Construction sectors" said Jamal Dabbagh. "Our activities are focused on the most valuable and high growth market segments in the Middle East, Africa and Asia and high oil prices and demographic trends in the region are likely to continue stimulating demand for RSH's products and services in the years to come". Mr. Jamal Dabbagh emphasized the Company's strategy of continued growth adding, "We have achieved a position of market leadership and professional excellence, and we intend to use our industry relationships to continue to strength our market position.

"RSH has successfully completed projects in more than 35 countries over the last 25 years. We have an unparalleled reputation in the industry for delivering quality products and services to demanding clients on time and on budget under the most challenging of conditions. This has allowed us to become one of the most profitable and dynamic companies in the world in this sector and we are proud that a Saudi company is acknowledged as setting standards worldwide in its chosen field. The IPO is intended to broaden and strengthen RSH's shareholder base, and to allow the company to access the public capital markets to fund its expansion strategy" stated Mr. Jamal Dabbagh.

"We have a longstanding international management team with specialist industry expertise and relevant experience, which will continue to improve the company's current product offerings by introducing new advancements and to developing initiatives to increase penetration of our target markets. RSH has state of the art manufacturing facilities strategically located in Saudi Arabia, the United Arab Emirates and Ghana, enabling us to offer our clients highly innovative and customized solutions. Our management team is committed to expanding our geographic reach and we are confident that we have the resources, track record and reputation to take advantage of the opportunity for growth in the region",

continued Mr. Jamal Dabbagh.

RSH which reported turnover and net profits of Saudi Riyals 422 million and 98 million respectively during its last financial year ending March 2005, is the first Dabbagh Group company to seek a public listing and to offer its shares to Saudi investors. In connection with the Saudi share market, Mr. Jamal Dabbagh said "Capital markets in Saudi Arabia are effectively regulated and the stringent disclosure requirements force companies to be transparent and to treat investors in accordance with highest standards. The regulatory framework governing capital markets in the Kingdom encourages only credible and well-managed companies to consider a public offering, further protecting the interests of the investing public". Mr. Dabbagh expressed his confidence in the offering stating "Our brand name is synonymous with exceptional quality and service, and our strong brand equity provides us with several strategic advantages".

Speaking at the signing ceremony, Mark Hanson, Head of Corporate Finance at SHB, said, "RSH's decision to appoint Saudi Hollandi Bank as the Lead Underwriter and Flotation Manager is a reflection of the excellent relationship we have with the company as well as the management's confidence in our capabilities".

Commenting on the regulation of capital markets in Saudi Arabia Tahir Al-Dabbagh, General Manager Western Region at SHB, said, "The approach to public offerings in the Kingdom compared to other regional markets has been measured, which bodes well for the market since it means only companies that meet stringent financial and regulatory criteria will be able to list". "We at SHB only work with companies which we feel have the strategic vision, and financial and operational strength to go public. Our involvement with the company begins well before it submits a formal request to the CMA for a public listing, which ensures that the candidate is fully prepared to meet the criteria set by the regulators for approval".

Mr. Suleiman Al-Suhaimi, Chairman of SHB, said, "This mandate reinforces our commitment to providing comprehensive financial advisory services to our clients and strengths our position as a significant player in the capital markets arena in Saudi Arabia". "We have a highly accomplished and competent team comprising local and foreign experts with significant experience in capital market transactions and we believe that we are well-positioned to advise Red Sea Housing Services Company on its IPO".