Wafa Insurance a model for shareholders to avoid loss-making firms: Chairman

Logo of Wafa Insurance

Saudi Indian Company for Cooperative Insurance (Wafa Insurance) Chairman Majid Al-Suwaigh said that what happened with Wafa Insurance is a lesson for shareholders to move away from loss-making companies whose capital is eroding and where there is no growth.

The company faced many challenges and everyone in the company worked to find solutions, Al-Suwaigh said in an interview with Al Ekhbariya TV.

He pointed out that the insurance company needed to raise the capital in the range of SAR 300-500 million, while there was a proposal to raise the capital by SAR 15 million without rights issue, which was less than required.

The number of employees decreased from 219 to only 15, the Chairman said, adding that at one point in the last five months the company had no employees. However, the board was able to retain six employees to maintain operations.

According to data available on Argaam, the fifth appeal circuit of Riyadh Commercial Court affirmed the order issued by the ninth commercial circuit of the court on the termination of the Wafa Insurance financial restructuring procedure and start of liquidation.

The company's stock is suspended since November 12, 2018, due to non-compliance with posting financial results during the specified periods.