Riyadh – AlAhli Takaful Company and Arabian Shield Cooperative Insurance have signed a binding memorandum of understanding (MoU) on 12 July for the potential merger between the two entities, according to two separate bourse disclosures on Monday.
Upon completion of the merger, AlAhli Takaful’s assets and liabilities will be transferred to Arabian Shield.
In addition, Arabian Shield will raise its capital to SAR 638.52 million from SAR 400 million by issuing 23.85 million new ordinary shares at a nominal value of SAR 10 each. This step will be against purchasing the entire shares owned by AlAhli Takaful’s shareholders at an overall nominal value of SAR 166.66 million.
Arabian Shield will also be issuing 1.43114769137705 shares for every one share in AlAhli Takaful.
Following the capital hike, the ownership percentage of AlAhli Takaful’s shareholders in the new entity of Arabian Shield after the merger will be 37.36%, while equity ownership of the entitled shareholders in Arabian Shield will be reduced from 100% to 62.64%.
Earlier today, the Saudi Exchange (Tadawul) announced suspending trading on the stocks of both AlAhli Takaful and Arabian Shield upon their requests in line with the expected merger.
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