Walaa Insurance, SABB Takaful sign binding merger agreement

Logos of Walaa Insurance and SABB Takaful

Walaa Cooperative Insurance Co. signed a binding merger agreement with SABB Takaful on Feb. 24, reflecting the agreement of both companies to merge through a share swap transaction, whereby Walaa will issue 0.6 nominal shares against each issued share in SABB Takaful for the benefit of eligible shareholders.

The insurer said in a bourse filing that this will be in exchange for the transfer of assets and liabilities of SABB Takaful, and without any additional cash consideration being paid.

Upon completion of the merger transaction, Walaa will become, by operation of law, the legal successor of the assets, liabilities, rights, and obligations of SABB Takaful and SABB Takaful shall cease to exist.

Walaa will announce any material developments regarding the proposed merger process, in accordance with the relevant laws and instructions. In the meantime, the company intends to continue carrying on its business as usual until the completion of the proposed merger.

According to data compiled by Argaam, Walaa and SABB Takaful signed a non-binding memorandum of understanding (MoU), on July 14, to evaluate a potential merger between the two companies.

In January, the companies extended the MoU on the potential merger for 45 days to finalize the due diligence process.

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