Shares of Abu Dhabi-based music streaming company Anghami soared 59% on Wednesday (March 20) after an SEC filing showed media company MBC Group has taken a 13.7% stake in the company. Anghami rose as high as $1.79 before closing at $1.59. Trading volume spiked to 11.3 million shares, over 300 times its daily average.
Saudi Arabia-based MBC Group bills itself as “the largest and leading media company in the Middle East and North Africa.” Founded in London in 1991 as a satellite TV channel, MBC Group’s properties now include 13 free-to-air TV channels, three radio stations and Shahid, a leading Arabic streaming platform. MBC Group also owns MBC Studios, a content production house, and MBC Academy, an educational and training platform.
The two companies already had a marketing partnership that renewed in 2022. The partnership gives Anghami exposure across MBC Group’s programming. MBC Group “create[s] new opportunities for rising music talent,” Fadel Zahreddine, Group Director of Emerging Media at MBC GROUP, said at the time, “and we continue to inspire upcoming musicians by encouraging platforms like Anghami to give them the creative space to publish their premium music content.”
Investors appeared to take MBC Group’s ownership stake as a positive sign that Anghami would have the financial and promotional resources to build a profitable business. Anghami shares have fallen 86% since its Feb. 4, 2022 debut on the Nasdaq. The company was warned by the Nasdaq exchange in Nov. 2023 for trading under the $1 threshold for the previous 30 days. The Nasdaq gives companies 180 days to regain compliance or face delisting from the exchange. Anghami said it would “consider available options to cure the deficiency,” including a reverse share split.
Wednesday’s closing price is well below the valuation of two recent investments in Anghami, however. Anghami received a $5 million strategic investment from SRMG in Aug. 2023 that valued Anghami at $2.50 per share. A Nov. 2023 deal with OSN Group that valued Anghami at $3.65 per share — and caused Anghami’s share price to jump 97% to a 52-week high of $3.11 — will provide Anghami with the OSN+ video streaming platform and result in an investment up to $50 million.
Anghami shares traded as high as $16.80 in April 2022 but have fallen 86% below the $11.00 closing price on its first day of trading on Feb. 4, 2022, after merging with Vistas Media Acquisition Company, a special purpose acquisition company. In the 55 trading days in 2024, Anghami has closed below $1.00 29 times.
In the first nine months of 2023, Anghami had 1.73 million subscribers and adjusted revenue of $30 million, up 8% year over year. The company has not yet announced full-year 2023 results.