Shaker board recommends 25% capital cut, followed by SAR 250 mln rights issue

Logo of Al Hassan Ghazi Ibrahim Shaker Co.

Al Hassan Ghazi Ibrahim Shaker Co.’s (Shaker) board of directors recommended a 25% capital cut from SAR 630 million to SAR 472.5 million through writing off 15.75 million shares (one share for every four shares), during a meeting held today, Sept. 19.

AlJazira Capital has been appointed as the financial advisor regarding the capital reduction and capital increase. Also, an announcement will be made upon submitting the company’s capital reduction application file to the Capital Market Authority (CMA) for approval.

Shaker added that there is no impact of the capital reduction on its financial obligations, operations, or operational, financial or organizational performance.

During the same meeting, the board of directors recommended a capital hike through a SAR 250 million rights issue to be implemented following the capital cut.

The approval of the EGM on the rights issue is conditional on the EGM approval on the proposed capital reduction.

The capital hike mainly aims at raising Shaker's financial solvency, and decrease borrowing rates and the financing costs incurred, the statement added.

Eligibility will be to shareholders holding shares on the day of the EGM that approves the capital hike, including those registered at the Securities Depository Center (Edaa) at the end of the second trading day following the date of the EGM. This date will be determined later.

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