CMA approves Budget Saudi’s 33.7% capital hike via bonus shares

Logo of United International Transportation Co. (Budget Saudi)

The Capital Market Authority (CMA) approved United International Transportation Co.’s (Budget Saudi) application to raise its capital from SAR 781.67 million to SAR 1.04 billion, the market regulator said in a statement.

The CMA said the planned capital hike will be carried out via a 1-for-3 bonus share distribution.

Eligibility for the bonus issue will be to shareholders registered with the Securities Depository Center (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.

The capital increase will be funded by transferring nearly SAR 263.76 million from retained earnings. Accordingly, the number of shares will rise from 78.17 million to 104.54 million.

The CMA added that the company’s deciding extraordinary general meeting (EGM) should be held within six months from this approval, provided all regulatory requirements and applicable laws are satisfied.

Budget Saudi’s board recommended last June increasing capital by 33.74% from SAR 781.7 million to SAR 1.0454 billion, according to Argaam’s data.

The company said the increase will be implemented by issuing 26.1 million bonus shares at one bonus share for every three ordinary shares held (33.33% of the capital increase) and allocating an additional 320,000 shares, representing 0.41% of the capital hike, to the long-term employee incentive program.

Fractional shares, if any, will be collected into one portfolio for all shareholders, to be sold at market price, with proceeds distributed to eligible shareholders pro rata within no more than 30 days from the date of determining the entitled shares, Budget Saudi added.