SCHEDULE: Anghami Inc. Stakeholders Formalize Share Options and Governance Framework

Key stakeholders in Anghami Inc. have entered into comprehensive option and shareholder agreements, outlining future share transactions, governance structures, and capital arrangements, including a new $23 million convertible note.

Summary

• OSN Streaming Holding Limited (Grantor) and Dplay Entertainment Limited (Grantee), with Discovery Communications, LLC as guarantor, have executed an Option Agreement for the sale and purchase of shares in OSN Streaming Limited, which holds a significant stake in Anghami Inc.
• The Option Agreement grants the Grantee a Call Option to purchase Grantor Shares and two Put Options (CM Put Option and CF Put Option) for the Grantor to purchase Grantee Shares, with prices determined by Anghami's fair market value and net debt.
• The Call Option Period is set from July 1, 2027, to June 30, 2028, with a Call Option Floor of USD 225 million (excluding Music Business) or USD 302 million (including Music Business).
• A Shareholders' Agreement was also established to regulate the affairs of OSN Streaming Limited and its ownership of Anghami shares, detailing board composition, director appointment rights, and matters requiring investor consent.
• OSN Streaming Limited and its affiliates beneficially own 72,411,753 Ordinary Shares of Anghami Inc., representing 70.8% of the class.
• This beneficial ownership includes 36,985,507 Ordinary Shares, 13,426,246 Ordinary Shares from warrants, and 22,000,000 Ordinary Shares from convertible notes (Initial, Second, and Third Notes).
• Anghami Inc. issued a Third Note for $23,000,000 to OSN Streaming on July 25, 2025.
• Dplay Entertainment Limited completed the purchase of 1,900,118 ordinary shares of OSN Streaming for $19,000,000 on July 23, 2025, representing 11.28% of OSN Streaming's total issued share capital.
• Dplay Entertainment Limited is set to acquire an additional 22.55% (totaling 33.83%) of OSN Streaming's share capital, subject to conditions.

Sentiment

Score: 7

Explanation: The filing outlines comprehensive legal agreements that provide clarity and structure for future transactions and governance, which is generally positive for investor confidence. It formalizes significant investments and strategic pathways, indicating stability and planned growth, despite the inherent complexity of such arrangements.

Positives

• The agreements establish a clear, structured framework for future share transactions and corporate governance among key stakeholders, reducing uncertainty.
• The defined Call and Put Options provide clear pathways for potential future ownership changes and liquidity events.
• The issuance of a $23,000,000 Third Note indicates continued investment and funding support for Anghami Inc.

Negatives

• The complexity of the option pricing mechanisms, involving Anghami Fair Market Value and Net Debt determination, could lead to disputes requiring independent expert determination.
• The detailed consent requirements for various corporate actions could potentially slow down decision-making or strategic flexibility.

Risks

• Directors may face conflicts of interest, requiring specific management procedures.
• The Music Business Carve-out, if elected, could have a material detrimental tax impact on the remaining Group's business.
• Potential for secondary tax liabilities and Pillar Two Taxes, which could result in additional payments by investors or Group companies.
• Failure to satisfy Call Option Conditions, such as the Company owning 100% of Anghami or obtaining necessary governmental approvals, could lead to the termination of the Option Agreement.

Future Outlook

The agreements establish a framework for potential future changes in ownership and control of OSN Streaming Limited and, indirectly, Anghami Inc. The Call Option allows the Grantee to acquire the Grantor's shares in OSN Streaming between July 2027 and June 2028, while Put Options provide mechanisms for the Grantor to acquire the Grantee's shares under specific conditions. The agreements also detail the process for potential Music Business carve-out, future funding, and exit strategies like IPOs or sales, indicating a long-term strategic plan for the entities involved.

Industry Context

This filing reflects ongoing strategic realignments and investments within the Middle East and North Africa (MENA) digital streaming and entertainment sector. The involvement of Discovery Communications, LLC (part of Warner Bros. Discovery) highlights the interest of major global media players in regional streaming markets, particularly in music and video content. The detailed agreements suggest a structured approach to managing complex joint ventures and potential future consolidation or divestment of assets in a rapidly evolving digital entertainment landscape.

Comparison to Industry Standards

• The governance structure, including board representation and investor consent rights, aligns with common practices for joint ventures and significant minority investments in the media industry, ensuring both operational control and minority shareholder protection.
• The inclusion of call and put options, with defined pricing mechanisms (e.g., based on fair market value and net debt), is a standard feature in private equity and strategic investment agreements to provide clear exit or acquisition pathways.
• The detailed provisions for a 'Music Business Carve-out' reflect a common industry trend of segmenting or divesting non-core assets to optimize business focus, similar to how larger media conglomerates streamline their portfolios.
• The specified IRR target for the Put Option Floor (15%) is a typical return expectation for strategic investments in growth-oriented digital businesses, comparable to venture capital or private equity benchmarks for mature-stage companies.

Management Changes

Corporate Governance

Related Party Transactions

• The Option Agreement is between OSN Streaming Holding Limited (Grantor), Dplay Entertainment Limited (Grantee), and Discovery Communications, LLC (Grantees Guarantor), all related parties through their investment in or guarantee of OSN Streaming Limited and Anghami Inc.
• The Shareholders' Agreement is between OSN Streaming Limited (Company), OSN Streaming Holding Limited (Lead Investor), and Dplay Entertainment Limited (WBD Investor), formalizing their relationship as shareholders.
• The purchase of 1,900,118 ordinary shares of OSN Streaming by Dplay Entertainment Limited from OSN Streaming Holding Limited for $19,000,000 is a related party transaction.
• The issuance of the $23,000,000 Third Note by Anghami Inc. to OSN Streaming is a related party transaction.
• The Shareholders' Agreement includes provisions for transactions with any Shareholder or its Investor Affiliates, requiring Investor Consent for material amendments or new agreements, except for term extensions.

Stakeholder Impact

• **Shareholders (OSN Streaming Holding Limited & Dplay Entertainment Limited):** The agreements formalize their investment, define future transaction options (call/put), and establish clear governance rights, providing a structured framework for their partnership and potential exit/acquisition strategies.
• **Anghami Inc.:** The agreements, particularly the convertible note, provide additional funding and strategic backing. The governance structure ensures oversight from key investors, potentially influencing strategic direction and operational decisions.
• **Employees:** The agreements do not directly mention employee impact, but the strategic clarity and potential for future growth or restructuring (e.g., Music Business Carve-out) could indirectly affect employees through changes in company focus or ownership.
• **Customers/Suppliers:** The agreements do not directly impact customers or suppliers, but the strategic direction and financial stability provided by these agreements could indirectly influence service offerings or business relationships in the long term.

Next Steps

• The Grantee may serve a Call Option Price Notice on the Grantor between July 1, 2027, and June 30, 2028, to initiate the Call Option process.
• Parties will engage in good faith discussions to determine Anghami's fair market value and net debt for option pricing.
• If no agreement on valuation, an Independent Expert will be appointed to determine Anghami's fair market value and net debt.
• The Grantee may exercise the Call Option within 90 days following the determination of Anghami's fair market value and net debt.
• If the Minority Buyout Condition is not met by the Call Option Longstop Date, parties will discuss a reduction to the Call Option Price, or the Grantee may exercise the CM Put Option.
• If the Determined Anghami Fair Market Value is below the Call Option Floor and the Grantor does not agree to a reduction, the Grantee may exercise the CF Put Option.
• The Lead Investor will develop the initial Business Plan and Annual Budget for the Group (including Anghami) within three months following the agreement date.
• The Lead Investor will consult with the WBD Investor on future Business Plans and Annual Budgets.
• The Lead Investor may establish the timing, structure, pricing, and terms of any Sale, Asset Sale, IPO, or Refinancing from the Call Option Lapse Date onwards.

Key Dates

Recommendation

This filing primarily details legal agreements and ownership structures rather than financial performance. While it outlines significant strategic moves, including a capital injection and future option agreements, it does not provide immediate operational or financial results that would warrant a 'buy' or 'sell' recommendation. The agreements establish a clear framework for future transactions and governance, which is a positive for long-term stability and clarity, but the impact on immediate share price performance is speculative and depends on market interpretation of these strategic alignments and future execution.

Keywords

Anghami Inc., OSN Streaming, Dplay Entertainment, Discovery Communications, Option Agreement, Shareholders Agreement, Convertible Note, Beneficial Ownership, Corporate Governance, Call Option, Put Option, Music Business Carve-out, SEC Filing, Middle East Streaming, Digital Media