Shareholders of Al-Ahlia Insurance Co. approved the merger with Gulf Union Cooperative Insurance Co. during the extraordinary general meeting (EGM) held on Nov. 2, the company said in a bourse statement.
Gulf Union will issue 7.95 million new ordinary shares at SAR 10 par value each, to buy all issued shares of Al-Ahlia at a total par value of SAR 79.47 million.
Meanwhile, shareholders also approved the merger terms and conditions, concluded on June 4, 2020, and authorized Al-Ahlia’s board of directors to take any decision necessary in this regard.
Al-Ahlia signed, on June 4, a binding merger agreement with Gulf Union to acquire all its shareholders’ issued shares through share swap without any cash payment, Argaam reported.
On Oct. 5, shareholders of Gulf Union approved the terms and conditions of the company’s merger deal with Al-Ahlia Insurance Co., signed on June 4.
Upon the merger completion, Al-Ahlia shareholders will own 34.63% of Gulf Union, while Gulf Union shareholders will own 65.37% of the company following the capital hike.
Both insurers received, on Aug.10, a no-objection letter on their merger deal from the Saudi Arabian Monetary Authority (SAMA).
Key Terms of Merger Deal |
|
Capital of Gulf Union |
SAR 150 mln (15 mln shares) |
Capital of Al-Ahlia |
SAR 123 mln (12.3 mln shares) |
Number of shares to be issued by Gulf Union |
7.95 mln |
Swap ratio |
0.646 shares of Gulf Union for each share of Al-Ahlia |
Gulf Union’s new capital |
SAR 229.47 mln (22.95 mln shares) |
Gulf Union’s stake after merger |
65.37% |
Al-Ahlia’s stake after merger |
34.63% |
The table below highlights the details of Gulf Union’s capital hike through issuing new shares to Al-Ahlia shareholders:
Key Figures of Capital Hike |
||
Current Capital |
SAR 150 mln |
|
Number of shares |
15 mln |
|
Hike (%) |
52.89% (0.646 new shares in Gulf Union for each share of Al-Ahlia) |
|
New Capital |
SAR 229.47 mln |
|
New number of shares |
22.94 mln |
|
Record date |
|
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