Al Rasheed gets CMA nod on 50% capital hike via bonus shares

Logo of Mohammed Hadi Al Rasheed and Partners Co. (Al Rasheed)

The Capital Market Authority (CMA) approved Mohammed Hadi Al Rasheed and Partners Co.'s (Al Rasheed) request to increase its capital by 50% from SAR 120 million to SAR 180 million, the market regulator said in a statement.

The CMA said the potential capital hike will be carried out via distributing bonus shares at one share for each two held shares. The issuance will be eligible to shareholders registered with the Securities Depository Center Co. (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 top-up will be funded by transferring SAR 60 million from retained earnings. Thus, the number of the company's shares will increase by 6 million from 12 million to 18 million.

The company’s extraordinary general assembly meeting (EGM) will be held within six months from this approval date, and the company shall satisfy all regulatory requirements and applicable laws.

According to Argaam’s data, Al Rasheed's board of directors proposed in September raising the company’s capital by 50% through a one-for-two bonus share distribution.

Al Rasheed said fractional shares, if any, will be aggregated into a single portfolio for all shareholders and sold at market price. The proceeds will be distributed to eligible shareholders on a pro rata basis within 30 days maximum from determining the entitlement to the new shares.