CMA approves ACIG request to increase capital through SAR 150 mln rights issue

Logo of Allied Cooperative Insurance Group (ACIG)

Allied Cooperative Insurance Group (ACIG) obtained the approval of the Capital Market Authority (CMA) to increase its capital through SAR 150 million rights issue, the market regulator said in a statement.

After reviewing the company's application in light of the governing regulatory requirements and the quantitative and qualitative criteria applicable to all companies requesting a capital increase, the CMA issued its resolution approving ACIG's capital increase request.

An investment decision based on the company's board recommendation to increase capital or the CMA's approval without carefully reading the rights issue prospectus or fully reviewing its content may involve high risk. Therefore, investors should carefully read the prospectus, which contains detailed information on the company, the offering and risk factors. It will provide investors the ability to evaluate the viability of investing in the offering, taking into considerations the associated risks.

If the prospectus proves difficult to understand, it is recommended to consult with an authorized financial advisor prior to any investment decision.

The CMA's approval of the prospectus should never be considered as a recommendation to participate in the offer nor invest in the company's shares. The approval of the prospectus merely means that the legal requirements as per the Capital Market Law and its Implementing Regulations have been met.

In January 2020, ACIG’s board of directors recommended a 29.5% capital reduction to SAR 141 million from SAR 200 million to restructure the company’s capital and offset accumulated losses. The board also recommended raising the company’s capital afterwards through a SAR 150 million rights issue, Argaam reported.

In August 2021, the insurer’s extraordinary general meeting (EGM) approved the board’s recommendation on a 29.5% capital reduction from SAR 200 million to SAR 141 million, through cancelling 5.9 million shares, to offset accumulated losses.