Arabian Pipes board recommends capital increase via SAR 150 mln rights issue

Logo of Arabian pipes Co.

Arabian Pipes Co.’s board of directors recommended today, July 17, to increase capital through a SAR 150 million rights issue, according to a bourse filing.

The capital hike aims to support and strengthen the company’s working capital and financial position, reduce the borrowing rate, develop and modernize factories in Riyadh and Jubail, as well as expand some products supporting pipe services within the firm’s business.

Arabian Pipes stated that, after reviewing future needs, as well as new and expected projects, and after the board of directors’ meeting with shareholders on June 5 and subsequent meetings, the amount of capital increase was determined at SAR 150 million.

Shareholders of record on the upcoming extraordinary general meeting (EGM) date and registered with the Securities Depository Center Co. (Edaa) at the end of the second trading day will be eligible for the capital hike.

The recommendation is subject to the approval of the official authorities and the EGM.

Shareholders rejected the board of directors’ recommendation to increase capital via a SAR 300 million rights issue during the EGM held on May 12, according to data available with Argaam.

In June 2021, the board of directors recommended a capital decrease by 75% to SAR 100 million from SAR 400 million, to amortize accumulated losses. The board also recommended that, after completing the capital decrease process, the company will increase its capital, through a rights issue worth SAR 300 million.

In February, the EGM approved reducing capital to SAR 100 million.

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