Wafa to file for financial restructuring under the new bankruptcy law

Saudi Indian Cooperative Insurance Co.’s (Wafa) board of directors has decided to file for financial restructuring under chapter 4 of the new bankruptcy law to avoid liquidation and protect shareholders interest, the insurer said in a bourse statement.

The decision was made to grant the company more time to complete the capital hike requirements and procedures or change its activity and cut capital, the statement added.

Last month, the insurer’s board recommended a capital cut as well as changing the company’s activity to avoid dissolving the company.

However, this does not preclude the completion of capital hike procedures if an underwriter is secured in a timely manner, a possibility that the board of directors believe, can’t be achieved under the current circumstances.