Saudi Arabian Cooperative Insurance Co. (SAICO) intends to enter into an agreement to build a multi-floor building on plot of land owned by the company, the company said in a bourse statement.
The land is located on the intersection of Makkah Road and Salah Al Dein Road by SAICO’s current headquarters.
The building will be equally owned by the both parties of the deal, while SAICO will operate some floors of the building after completion, the statement added.
The project is expected to be completed within two years from the date of starting construction and its cost will exceed 1 percent on the company’s gross revenue according to financial statements for FY 2018.
The total cost of the land and the building is estimated at SAR 101.33 million.
The company’s chairman has an indirect interest in the project.
The deal is expected to have a positive energy on the company’s financial due to saving the rent paid in addition to generating a revenue from the rent received.
SAICO’s solvency margin will shrink without falling below the required regulatory limit.
The deal is subject to the approvals of the company’s general assembly and other regulatory parties.