Logo of Saudi Reinsurance Co.
Saudi Reinsurance Co. (Saudi Re) inked, on July 4, a binding subscription agreement with the Public Investment Fund (PIF), according to a statement to Tadawul.
As part of the subscription agreement, the insurer will increase its capital from SAR 891 million to SAR 1.15 billion, while suspending the pre-emptive rights.
PIF will fully subscribe to the new shares, bringing its ownership in the company to 23.08% after the capital hike.
Saudi Re’s board of directors recommended a capital increase by issuing 26.73 million new ordinary shares, representing 30% of its current capital, at a nominal value of SAR 10 per share, at an offering price of SAR 16 per share, totaling SAR 427.68 million.
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Capital Increase Details |
|
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Current Capital |
SAR 891 mln |
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Number of Shares |
89.1 mln |
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Percentage of Increase |
30% |
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New Capital |
SAR 1.15 bln |
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Number of Shares |
115.83 mln |
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Number of New Shares |
26.73 mln |
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Offering Price |
SAR 16 per new share |
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Total Subscription Amount |
SAR 427.68 mln |
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Reasons |
Boost the company’s growth and financial position |
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Target |
PIF will fully subscribe to the new shares, bringing its ownership to 23.08% after the capital hike |
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Record Date |
Shareholders of record on the date of the extraordinary general meeting (EGM) when the capital increase via share issue will be approved. Subscription will be confined to the new share. |
In full consideration of issuing the new shares, PIF will pay the company a subscription of SAR 16 per each new share, for a total subscription of SAR 427.68 million, subject to the non-objection of the Insurance Authority (IA) and the approval of the Capital Market Authority (CMA).
The capital increase is subject to approvals from other competent authorities such as the Saudi Exchange (Tadawul), EGM, as well as other internal approvals from PIF.
Upon completion of the capital increase, Saudi Re shall follow the necessary procedures to appoint three board members to be nominated by the PIF.
The insurer will duly announce filing for the CMA approval on the capital hike.
Al Rajhi Capital will be the financial advisor for Saudi Re, while GIB Capital will be the financial advisor for the PIF.
The PIF is not a related party in the deal, the statement added.
Saudi Re signed, on Oct. 7, a non-binding MoU with the PIF, under which the sovereign fund will subscribe to new cash shares in the former by way of capital increase while suspending pre-emptive rights of the current shareholders, Argaam reported.
The insurer agreed, on Dec. 25, with PIF to extend the MoU previously signed for subscription to new cash shares for addition six months starting Jan. 7, 2024.
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