Tihama files for financial reorganization to preserve shareholder rights, ensure company sustainability

Logo of Tihama Advertising and Public Relations Co.

Tihama Advertising and Public Relations Co. announced submitting a request for financial reorganization with the competent court, to preserve shareholder rights and ensure company sustainability, according to a filing to Tadawul today, Oct. 6.

The registration of the financial reorganization application exempts the company from applying the provisions of the Companies Law regarding accumulated losses in case of reaching 50% or more of capital.

The application was registered before the expiry of the period specified in Article 150 of the Companies Law.

Tihama emphasized that it continues to work on completing the statutory requirements to increase capital in accordance with the board’s recommendation by offering rights issue shares worth SAR 350 million, which was approved by the Capital Market Authority (CMA).

It is currently difficult to determine the financial impact that may result from the registration of the application, which will be announced, if any, in due course.

Tihama obtained the CMA’s approval to increase its capital via a SAR 350 million rights issue, according to data available with Argaam.

In February, shareholders approved a capital cut by 71.43% to SAR 50 million from SAR 175 million, through cancelling 12.5 million shares.