The Capital Market Authority (CMA) has approved a plan by Saudi Reinsurance Company (Saudi Re) to increase its capital through a new share issuance. The approval was granted on 25 November 2024, according to a stock exchange statement issued by Saudi Re.
The proposed capital hike was announced in August 2024 by Saudi Re, based on the company’s board of directors’ recommendation in July to increase the company's capital by offering 26,730,000 new ordinary shares, representing 30% of the company's current capital.
The Public Investment Fund (PIF), the sovereign wealth fund of Saudi Arabia, will subscribe fully to the new shares, resulting in its ownership of 23.08% of the company's share capital after the capital increase.
The CMA's approval is conditional on Saudi Re’s extraordinary general assembly’s approval and the completion of all relevant regulatory requirements and procedures.
Walaa Cooperative Insurance
Separately, shareholders of Walaa Cooperative Insurance Company voted during an extraordinary general meeting on 26 November for the insurer’s proposal to raise its capital through a rights issue.
In the rights issue, the number of shares will jump from 85,058,325 shares to 127,558,325 shares, an increase of 42,500,000 shares at a rate of 0.4997 shares per one owned share. The nominal value of each share is SAR10 while the rights offer price is SAR11 per share, meaning a total rights issue value of SAR467,500,000.
The CMA granted its approval on 5 August for the rights issue.
The period for subscribing to the rights issue is from 2 December to 12 December. The rights trading period ends on 9 December for shareholders who do not wish to subscribe to the issue.
At the end of the rights issue subscription period, shares that remain unsubscribed will be offered to institutional investors. The underwriter, Al-Jazira Capital, shall underwrite the rights issue in the event that the entire subscription is not fully covered.
Saudi Enaya Cooperative Insurance
Meanwhile, shareholders of Saudi Enaya Cooperative Insurance have rejected the board’s recommendation to increase the insurer’s capital through a SAR150m rights offering. The voting took place at an extraordinary general meeting (EGM) held on 28 November.
The insurer’s current issued capital comprises 23m shares with a nominal value of SAR230m.
Saudi Enaya’s board recommended on 10 December 2023 to raise the company’s capital to SAR380m.
Saudi Enaya had said that the purpose of the rights issue was for it to comply with the minimum required capital of insurance companies, and support business development plans and the solvency margin. The company reported accumulated losses of SAR41.8m as of 31 December 2023, down from SAR62m 12 months previously.