Khalil Kurdi, Amiantit’s CEO
Saudi Arabian Amiantit Co. suffers from a lack of liquidity despite its elements of success, CNBC Arabia reported, citing CEO Khalil Kurdi.
The company's plants are currently in place and need liquidity to purchase raw materials that are priced high in global markets, the CEO added.
The capital reduction recommendation was made to offset accumulated losses, while the recommendation to increase capital was made to cover liquidity shortfalls.
Kurdi said Amiantit is one of the first industrial companies in the Kingdom and has a good reputation. It is working to regain its former position by injecting fresh capital.
Kurdi added that the company's management is excellent and things are under control, but it is experiencing intense competition in all markets and suffering from a decline in output at its plants due to low demand.
Asked about the possibility of the company selling some assets to cover its liquidity need, Kurdi said that the company's current position is good and it is only witnessing a decline. Amiantit will not sell its assets to cover the lack of liquidity, he noted.
There are ongoing negotiations with the government, he said, noting that the Amiantit’s priority in production is first to meet domestic demand and then the GCC.
On Nov. 22, Amiantit’s board recommended a 69.06% capital reduction from SAR 320 million to SAR 99 million, followed by a capital increase through a SAR 221 million rights issue, according to data available on Argaam.
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