CMA nods to Saudi Re’s 46.6% capital increase via bonus issue

Logo of Saudi Reinsurance Co. (Saudi Re)

The Capital Market Authority (CMA) approved Saudi Reinsurance Co.’s (Saudi Re) request to raise capital by 46.6% from SAR 1.158 billion to SAR 1.69 billion, the company stated in a statement on Tadawul.

The capital increase deal will be executed through the distribution of 4:9 bonus shares (4 bonus shares for each 9 ordinary shares). In addition, the market regulator said bonus shares will be eligible to shareholders registered with the Securities Depository Center Co. (Edaa) by the end of the second trading day following the record date, which will be determined later by the company's board of directors.

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The planned capital hike will be funded by capitalizing SAR 539.8 million from the company’s retained earnings account. Consequently, the number of the company's outstanding shares will rise from 115.83 million to 169.81 million.

The authority stipulated that the date of the extraordinary general assembly meeting (EGM) shall be held within six months of this approval date, and the company shall satisfy all regulatory requirements and applicable laws.

Last March, Saudi Re’s board of directors recommended a 46.6% capital increase from SAR 1.158 billion to SAR 1.698 billion through a bonus share distribution. The board proposed distributing 51.48 million bonus shares, granting shareholders four shares for every nine held. It also recommended allocating an additional 2.5 million shares to the company’s long-term employee stock incentive plan (ESIP), according to Argaam’s data.

The company announced in May that it received CMA’s approval on the company’s capital increase from SAR 1.16 billion to SAR 1.7 billion through the capitalization of SAR 539.8 million from retained earnings.