Malath Cooperative Insurance & Reinsurance (Malath) has agreed with Allied Cooperative Insurance Group (ACIG) to study the feasibility of a potential merger between the two firms, Malath said in a statement Wednesday.
The two Saudi insurers will sign a non-binding memorandum of understanding (MoU) within 12 months to carry out the related technical, financial, and legal studies.
The merger will be subject to approval from regulatory authorities and shareholders, the statement said, adding that any further developments will be announced in due course.
Earlier this month, Tadawul-listed companies Gulf General Cooperative Insurance and Al Ahlia Cooperative also said they had decided to start initial talks for a potential merger.
Although the Saudi insurance market is one of the largest in the Arab Gulf region, some of its smaller firms have suffered the erosion of 50 percent or more of their capital.
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