Logos of Amana Insurance and Saudi Enaya Insurance
Sulaiman Hilal, Chief Executive Officer (CEO) of Amana Cooperative Insurance Co., said the merger with Saudi Enaya Cooperative Insurance Co. will create a strong, profitable entity. Both companies have plans to cut general expenses and leverage on the cadres at both insurance firms.
The financial solvency margin will definitively see improvement after the merger, which will strengthen the financial position of the new entity, Hilal told Argaam in an exclusive, adding that the merger will also allow the new entity to benefit from the geographical distribution of Amana and Saudi Enaya.
The new merger will add a competitive value and will be a major driver for offering new products. The merged entity will also enter into talks and alliances to get better insurance policies and transfer the foreign expertise to the Saudi market, Hilal affirmed.
The new entity’s negotiating strengths will enhance talks with reinsurers, medical services providers and car workshops to obtain preferential prices, which will be reflected positively on the new entity.
Elsewhere, Mahmoud Al Toukhi, Board Chairman, Amana Insurance, affirmed that the merger will enhance capital efficiency, reduce general expenses, capitalize on human cadres at both companies and offer better products.
The executive management has cooperated with renowned houses of experience to develop clear strategies and benefit from the alliance. This move aims to enhance the new entity’s competitive ability and raise market share. These local and global companies and strategic partners include Munich Re, The National Health Insurance Co. (Daman) and Libano-Suisse, Al Toukhi added.
Amr Khashoggi, Board Chairman, Saudi Enaya, said the merger with Amana will allow the company to tap new sectors, such as motor insurance, etc. The Saudi market is promising, especially the insurance industry, and needs technical experts.
The merger will also save costs and expenses, Khashoggi added, expecting the consolidation to make a qualitative shift in terms of offering the best services in line with the best practices. This will, in turn, contribute to strengthening the financial solvency of both companies and offset losses.
The Capital Market Authority (CMA) approved, on Dec. 6, the request received from Amana to increase its capital from SAR 130 million to SAR 288.58 million by issuing 15.86 million ordinary shares to merge with Saudi Enaya, Argaam reported.
Shareholders of Amana will vote on the merger with Saudi Enaya during the extraordinary general assembly meeting (EGM) scheduled for Jan. 9, 2022.
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