Raydan plans 70% capital cut by lowering par value, before rights issue

According to a statement on Tadawul, the board recommended a 70% capital reduction to SAR 21.94 million from SAR 73.14 million to restructure capital and offset accumulated losses, via a par value cut from SAR 10 to SAR 3.

Capital Cut Details

The company said the capital reduction is not expected to have any material impact on its liabilities, operations, or financial, operational, or organizational performance. It added that the reduction remains subject to approval from the relevant regulatory authorities and the EGM.

The board also recommended, following the capital reduction, a SAR 105 million rights issue to fund expansion plans, support working capital, and strengthen the company’s financial position.

Entitlement will be for shareholders holding shares on the EGM date approving the rights issue, as well as those registered in the issuer’s shareholder register by the end of the second trading day following the EGM.

The capital increase remains subject to approval from the relevant regulatory authorities and the EGM.

The board appointed Wasatah Capital as financial advisor for both the capital reduction and the rights issue.

It also said it will announce in due course upon submitting the capital reduction and capital increase filings to the Capital Market Authority (CMA) for approval.

The company clarified that the EGM approval for the SAR 105 million rights issue is conditional on approval of the proposed capital reduction.