Logo of Salama Cooperative Insurance Co.
The Capital Market Authority (CMA) gave the go-ahead for Salama Cooperative Insurance Co.’s request to increase its capital through a SAR 100 million worth rights issue, the market regulatory announced in a statement.
The rights issue will be limited to shareholders registered with the Security Depository Center (Edaa) at the end of the second trading day after the extraordinary general meeting (EGM), whose date will be determined by the board later.
Salama will set the offering price and size after the close of trading on the EGM date.
The CMA's approval came after reviewing the insurer’s application in light of the regulatory requirements, as well as the quantitative and qualitative criteria applicable to all companies requesting a capital increase.
The rights issue prospectus will be posted and made available to the public later.
An investment decision based on the company's board recommendation to increase its capital or the CMA's approval without carefully reading the rights issue prospectus or fully reviewing its content may involve high risk, the authority noted.
Therefore, investors should carefully read the prospectus, which contains detailed information on the company, the offering and risk factors. Thus, investors can evaluate the viability of investing in the offering, taking into consideration the associated risks.
If the prospectus proves difficult to understand, it is recommended to consult with an authorized financial advisor prior to any investment decision.
The CMA's approval of the prospectus should never be considered a recommendation to participate in the offer or invest in the company's shares.
The CMA's approval of the prospectus means that the legal requirements as per the Capital Market Law and its Implementing Regulations have been met.
In August 2022, Salama’s board of directors proposed increasing capital by SAR 200 million through a rights issue, then amended its recommendation to SAR 100 million rights issue, according to data compiled by Argaam.
The Saudi Central Bank (SAMA) approved the capital increase request in November 2022.
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