Molan Steel proposes rights issue, transfer of offering premium to retained earnings

Logo of Molan Steel Co.

Molan Steel Co.’s board of directors recommended on Oct. 10 a capital increase by SAR 26.6 million through a rights issue, according to a statement to Tadawul.

The rights issue will allow Molan Steel to buy assets, expand operations, and finance working capital.

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Shareholders on the day of the extraordinary general meeting (EGM) that approves the capital increase and those registered with Edaa at the end of the second trading day following the EGM are eligible for the rights issue.

The board’s proposal is subject to shareholders’ approval.

The company will later announce the relevant developments as regards the appointment of the financial advisor and filing for the Capital Market Authority’s approval, the statement added.

In a separate statement, Molan Steel announced the board’s proposal to transfer the entire offering premium of SAR 4.7 million to the retained earnings to offset the balance of the company's accumulated losses.

The accumulated losses stand at SAR 3.7 million, representing 13.97% of capital, as per the interim financial statements ended on June 30, 2024, the statement added.