SCHEDULE 13D/A: OSN Streaming Group Bolsters Anghami Stake to 70.8% with New $20 Million Convertible Note Issuance

OSN Streaming Ltd and its affiliates have significantly increased their beneficial ownership in Anghami Inc. to 70.8% through a combination of existing shares, warrants, and new convertible notes, including an upcoming $20 million issuance.

Summary

• The reporting persons, including OSN Streaming Ltd, OSN Streaming Holding Limited, Panther Media Holding Limited, Panther Media Group Limited, and Kuwait Projects Company (Holding) K.S.C.P (KIPCO), collectively beneficially own 72,411,753 Ordinary Shares of Anghami Inc.
• This aggregate beneficial ownership represents 70.8% of Anghami's Ordinary Shares, calculated based on a total of 102,290,942 Ordinary Shares.
• The beneficial ownership comprises 36,985,507 currently held Ordinary Shares, 13,426,246 Ordinary Shares issuable upon the exercise of warrants at a price of $11.50 per share, and 22,000,000 Ordinary Shares issuable upon the conversion of various notes.
• The convertible notes include an Initial Note of $12,000,000, a Second Note of $20,000,000 expected to be issued on February 7, 2025, and remaining Additional Notes up to $23,000,000 that OSN Streaming may elect to purchase.
• All convertible notes are convertible at a per share conversion price of $2.50.
• The calculation of percentage ownership includes warrants and convertible notes held by the Reporting Persons but excludes other outstanding warrants or convertible notes held by other persons.
• As of January 31, 2025, there were 66,864,696 Ordinary Shares outstanding, as provided by the Issuer.

Sentiment

Score: 7

Explanation: The sentiment is moderately positive. The significant increase in beneficial ownership and continued capital injection from a strategic partner like OSN/KIPCO indicates strong support and potential for growth. However, the substantial potential dilution from the conversion of warrants and notes, particularly at a $2.50 conversion price, introduces a notable negative aspect for existing shareholders.

Positives

• The significant increase in beneficial ownership by OSN Streaming and its affiliates, including KIPCO, demonstrates strong strategic commitment and confidence in Anghami's future.
• The issuance of an additional $20,000,000 convertible note provides Anghami with further capital, supporting its operations and growth initiatives.
• The potential for OSN Streaming to purchase up to an additional $23,000,000 in notes indicates a continued source of potential funding for Anghami.

Negatives

• The conversion of 22,000,000 Ordinary Shares from the notes, along with 13,426,246 shares from warrants, represents a substantial potential dilution for existing shareholders.
• The conversion price of $2.50 per share for the notes could be significantly below the current market price, leading to immediate dilution upon conversion.

Risks

• Significant potential dilution for existing shareholders upon the conversion of warrants and convertible notes held by the Reporting Persons.
• Reliance on OSN Streaming's election to purchase the remaining Additional Notes for future funding, which is not guaranteed.

Future Outlook

Anghami Inc. is expected to issue an additional $20,000,000 convertible note to OSN Streaming on February 7, 2025. Furthermore, OSN Streaming retains the option to purchase up to an additional $23,000,000 in convertible notes under the existing Note Purchase Agreement.

Industry Context

This filing highlights the continued strategic investment by OSN, a major entertainment network in the Middle East and North Africa (MENA) region, into Anghami, a leading music streaming platform in the same region. This deepens the integration and financial backing for Anghami, which operates in a competitive global and regional streaming market. The investment could enable Anghami to further expand its content offerings, user base, and market penetration in the MENA region, leveraging OSN's established presence and resources.

Related Party Transactions

• The transaction involves the issuance of convertible notes from Anghami Inc. to OSN Streaming Ltd, which is part of a group of reporting persons that collectively hold a significant beneficial ownership stake in Anghami, indicating a related-party transaction.

Stakeholder Impact

• Shareholders: Potential for significant dilution due to the conversion of warrants and convertible notes, but also potential benefit from strengthened financial backing and strategic partnership.
• Employees: Enhanced financial stability could support continued operations and growth, potentially benefiting employees.
• Customers: Increased investment may lead to improved services, content, and user experience.
• Creditors: The capital injection could improve the company's financial health, potentially reducing credit risk.
• Suppliers: Stable financial position may ensure timely payments and continued business relationships.

Next Steps

• Issuance of the $20,000,000 Second Note to OSN Streaming on February 7, 2025.
• OSN Streaming may elect to purchase up to an additional $23,000,000 in remaining Additional Notes pursuant to the Note Purchase Agreement.

Key Dates

Keywords

Anghami Inc., OSN Streaming, Kuwait Projects Company (Holding) K.S.C.P, KIPCO, Schedule 13D, beneficial ownership, convertible notes, warrants, equity stake, dilution, streaming, Middle East, North Africa, music streaming