Arabian Pipes shareholders approve 75% capital cut to SAR 100 mln

Logo of Arabian Pipes Co.

Arabian Pipes Co.'s shareholders approved reducing the company's capital by 75%, from SAR 400 million to SAR 100 million, to restructure capital in order to offset accumulated losses, during an extraordinary general assembly meeting (EGM) held on Feb. 20, according to a bourse filing.

The company said in a bourse statement that the process will not have a material effect on its financial obligations.

Meanwhile, shareholders approved amending articles of the company’s bylaws related to capital, shares subscription, company objectives and liability lawsuits.

The company’s accumulated losses reached around SAR 39.9 million (39.9% of capital). Accordingly, the board of directors decided to reduce the accumulated losses by using part of the statutory reserve. Thus, the balance of accumulated losses will be approximately 0%, according to a separate bourse filing.

In another separate statement, the Saudi Exchange (Tadawul) said that the fluctuation limits for Arabian Pipes will be based on a share price of SAR 69.80 and the outstanding orders will be canceled.

Furthermore, the company will be suspended as per the Listing Rules for two business days, starting from today, Feb. 21, until the Securities Depository Center Company (Edaa) reflects shares reduction on investors’ portfolios.

The suspension on trading will be lifted on Wednesday, Feb. 23.