Atheeb Telecom proposes 60% capital cut to narrow losses

The board of Etihad Atheeb Telecom Co. has proposed cutting the company’s capital by 60 percent to SAR 630 million from about SAR 1.6 billion, the company said in a statement to Tadawul Monday.

Atheeb will cancel 94.5 million shares from its current 157.5 million shares as it moves to cut losses, which have exceeded its capital. The company blamed its accumulating losses on the use of outdated technologies— such as Wimax— in the past few years.

The capital reduction, still subject to regulatory approvals, will not have an impact on Atheeb’s liabilities, the telco added.

The company will announce its financial advisor for the capital reduction at a later date.