SAL Saudi Logistics Services (SAL), a market leading air cargo handler and a member of Saudi Arabian Airlines Corporation, said it has signed an agreement with Taiba Airports Operation Company for the leasing of  a prime plot at Prince Mohammed bin Abdulaziz International Airport in Madinah.

The transaction, which is valued at SAR420,000 per year (or a percentage of the revenue, whichever is higher), is for a land area of 7,500 sq m (3,500 actual sq m and 4,000 sq m reserved) for a period of 16 years, said SAL in its filing to the Saudi bourse Tadawul.

On the expected impact of the transaction, SAL said the agreement reduces rental costs by SAR34.3 million throughout the contract period.

As per the deal, the area of land can be utilised for the benefit of SAL for the purpose of expansion, it stated in the bourse filing.

It is expected that SAL will invest an estimated amount of SAR12 million in the development of the new terminal  which will increase the terminal capacity and efficiency, it added.