Avalon Pharma obtains CMA nod for capital hike via bonus shares

Avalon Pharma’s capital hike will be paid by transferring SAR 150 million from the retained earnings

The Capital Market Authority (CMA) approved Middle East Pharmaceutical Industries Co.’s (Avalon Pharma) capital top-up request by 75% from SAR 200 million to SAR 350 million, through a 3-for-4 bonus share issue.

Subscription eligibility will be limited to shareholders registered with the Security Depository Center (Edaa) as of the closing of the second trading day after the deciding extraordinary general meeting (EGM), the date for which is yet to be set by the company’s board of directors.

In a statement, the CMA said that increase will be paid by transferring an amount of SAR 150 million from the retained earnings account to the company's capital.

Consequently, increasing the company's outstanding shares from 20 million to 35 million shares.

The EGM shall be held within six months from this approval date and the company shall satisfy all regulatory requirements and applicable laws, the statement added.

According to data available by Argaam, Avalon Pharma board of directors recommended a 75% capital increase through a 3-for-4 bonus share issue.