Saudi Paper Manufacturing Co.’s (SPM) board of directors team has recommended a 39.2 percent capital reduction to SAR 149 million from SAR 245 million to restructure the company’s capital, offset accumulated losses and support future growth, the company said in a statement on Tadawul.
There is no significant impact of the capital reduction on the company's liabilities or operations, the statement added.
The board team has also recommended raising the company’s capital afterwards through a SAR 150 million rights issue.
Both processes, the capital cut and capital hike, are pending approval from the general assembly and regulator.
The company expects these decisions to offset accumulated losses, boost financial positions and improve solvency.
In March, the company’s board of directors formed a committee to study restructuring capital through available options, Argaam reported earlier.
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Key Figures of the Capital Reduction |
|
|
Current Capital |
SAR 245 mln |
|
Number of shares |
24.50 mln shares |
|
Reduction (%) |
39.2% |
|
New Capital |
SAR 149 mln |
|
New number of shares |
14.9 mln shares |
|
Method |
Cancellation of 9.6mln shares |
|
Driver |
To restructure capital and offset accumulated losses |
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