Saudi Cable scraps capital cut plans, proceeds with hike to SAR 346.73 mln via rights issue

Saudi Cable pointed out that this amendment was based on many discussions with financial advisors.  

Accordingly, the board decided to withdraw its previous capital reduction recommendation, as the cable producer negotiated with a number of investors to purchase part of its debt, which will be converted into ordinary shares at nominal value.  

Moreover, Saudi Cable witnessed further developments with respect to its initiation of financial restructuring procedures.  

Maintaining the recommendation of capital increase through a rights issue is aimed at availing liquidity for operational expansions, Saudi Cable indicated, adding that any material developments in this regard will be announced in due course.  

There are no costs associated with this amendment in the current time.   

The financial impact, if any, will be timely announced, the statement added.  

The completion of capital increase procedures, upon shareholders’ approval during the next extraordinary general meeting (EGM), will help reduce the accumulated losses-to-capital ratio to less than 50%, in compliance with the provisions of Article 150 of the Companies Law.   

It will also provide liquidity to support the working capital and improve the company's cash flows.  

According to data compiled by Argaam, Saudi Cable’s board recommended, in October 2022, cutting capital by 89.5% from SAR 66.73 million to SAR 7 million to offset accumulated losses. A capital hike through a SAR 280 million rights issue was set to follow.