Riyadh - Amana Cooperative Insurance Company has inked a non-binding memorandum of understanding (MoU) with Allied Cooperative Insurance Group (ACIG) to evaluate a potential merger between the two companies.

The two insurers will conduct technical, financial, legal, and actuarial due diligence and engage in non-binding discussions on the terms and conditions of the proposed merger, according to a bourse statement on Sunday.

The two insurers agreed that the methodology used for valuation will be based on equity book value.

The MoU would expire if the two firms sign the merger agreement or after 12 months from the MoU signing date.

The proposed merger shall be subject to the approval of competent authorities and the general assemblies of the two companies, Amana said, adding that it will announce further details when appropriate.

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