Saudi Reinsurance Company “Saudi Re” (8200) signed a binding subscription agreement with the Saudi sovereign wealth fund on July 4th.
Under the agreement, the latter will subscribe to new shares to be issued in the company, continuing its strong support for local companies.
Details
The Board of Directors of “Saudi Re” recommended increasing the company’s capital from SAR 891 million to about SAR 1.1 billion.
This will be done by issuing 26.7 million new shares (representing 30% of its current capital), with the preemptive right offers being waived.
So What
The Public Investment Fund will fully snap up the new shares, giving it an approximately 23.1% stake in “Saudi Re.”
The fund is set to pay a subscription amount of SAR 16 per new share.
The total subscription will amount to about SAR 427.7 million.
This is pending non-objection from the Insurance Authority and the approval of the Capital Market Authority.
The company aims to increase its capital to fuel its expansion and strengthen its financial position.
Some Context
Saudi Re, founded in 2008, is the first full reinsurance company in Saudi Arabia.
It provides its services to more than 40 countries in the Middle East, Africa, and Asia.
The company’s net profits increased 184% YoY during the first three months of 2024, reaching SAR 31.8 million.
Now What
Following the capital increase, three new board members will be appointed, subject to certain conditions.
They will be nominated by the kingdom’s sovereign wealth fund.
