Saudi Fisheries issues shareholders' circular on capital reduction

Logo of Saudi Fisheries Co. (SFICO)

Saudi Fisheries Co. (SFICO) issued a shareholders’ circular on its planned 83.25% capital reduction to SAR 66.99 million from SAR 400 million, according to a statement filed with Tadawul today, Jan. 5.

The board of directors explained that the capital cut is in favor of both Saudi Fisheries and its shareholders. A detailed review, supported by a limited assurance report, affirmed no significant impact on the company’s financial, operational, or regulatory obligations as a result of the move.

Saudi Fisheries emphasized that this move is part of a broader strategy to strengthen its financial position and foster future growth. The planned capital reduction aims to offset accumulated losses and enhance the company’s balance sheet.

In response to current challenges, the company highlighted the importance of reducing accumulated losses and outlined key measures in its recovery plan. These include reducing farm operating costs, divesting underperforming assets, closing unprofitable outlets, boosting wholesale sales, cutting logistics costs, optimizing inventory management, terminating unnecessary service contracts, conducting market research, and renegotiating supplier contracts for more favorable terms.

The extraordinary general meeting (EGM) to approve the capital reduction is scheduled for 6:30 pm on Jan. 26, via electronic means.

If approved, the reduction will apply to shareholders holding shares on the EGM date, as recorded by the Securities Depository Center Co. (Edaa) two trading days after the meeting.

Any fractional shares will be consolidated, sold at the market price, and proceeds distributed to shareholders within 30 days.

In January 2024, Saudi Fisheries’ board had previously recommended reducing the capital from SAR 400 million to SAR 188.44 million to cover accumulated losses. In October 2024, the reduction was adjusted to 83.25%, hence lowering capital to SAR 66.99 million, with the Capital Market Authority (CMA) approving the request in December 2024.