City Cement board recommends 26% capital cut

05/11/2019 Argaam

 

City Cement Co.’s board of directors on Nov. 4 recommended 26 percent capital cut to SAR 1.4 billion from SAR 1.89 billion through share cancellation, the company said in a statement on Tadawul.

 

The capital reduction will be financed from the company’s internal resources and loans.

 

The process will have no material impact on operations, the company said, expecting the capital cut to bolster its profitability and performance.

 

The capital cut will be implemented on the second day after end of creditor objection period.

 

The capital reduction is subject to shareholders and regulatory authorities’ approvals.

 

City Cement will hire a financial adviser for the capital cut and submit the related request to the Capital Market Authority (CMA) for approval later on.

 

Key Figures of the Capital Reduction

Current Capital

SAR 1.89 bln

Number of shares

189.2 mln shares

Reduction (%)

26%

New Capital

SAR 1.4 bln

New number of shares

140 mln shares

Method

Cancellation of 26% of shares

Driver

The company has excess capital

 

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