Al Ahlia for Cooperative Insurance Co.’s board of directors has recommended on March 12 to reduce capital by around 23.1 percent to SAR 123 million from SAR 160 million, the insurer said in a bourse statement.
Accordingly, shares will be cut to 12.3 million shares from 16 million shares (1 share for every 4.324 outstanding shares) to restructure capital in order to offset accumulated losses and support future growth, it said.
The company added that the capital reduction shall not impact its financial liabilities.
The board of directors also recommended a capital hike of SAR 127 million through issuing rights shares at a price that is to be determined, the statement said.
The capital increase aims to support solvency and geographic expansion, and increase income from investments.
Both the capital cut then hike are pending shareholders and regulatory approvals, the statement added.
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Key Figures of the Capital cut |
|
|
Current Capital |
SAR 160 mln |
|
Number of shares |
16 mln shares |
|
Cut (%) |
23.13% (1 shares for every 4.324 shares) |
|
New Capital |
SAR 123 mln |
|
New number of shares |
12.3 mln shares |
|
Method |
Cancelling 3.7 mln shares |
|
Driver |
To restructure capital in order to offset accumulated losses and support future growth |
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