Wafa Insurance recommends capital hike via SAR 300 mln rights issue

Saudi Indian Co. for Cooperative Insurance’s (Wafa Insurance) board of directors recommended a capital hike through a SAR 300 million rights issue, the company said in a bourse statement.

The capital hike aims to enhance solvency margin and support the company to resume its insurance operations.

The process is pending approvals from the general assembly and regulator.

Shareholders of record on the second day after the extraordinary general meeting will be entitled to subscribe to the offering.

Submitting the capital increase file to the Capital Market Authority (CMA) and appointing a financial advisor will be announced later, the insurer added.

Wafa’s shares are suspended since Nov. 12, 2018. The stock was traded at SAR 9.5 before suspension, according to data compiled by Argaam.

The company’s accumulated losses reached SAR 207.64 million representing 207.64% of capital, as per the last disclosed financial results for the first nine months of 2019. Losses were attributed to loss from operations and halting sales.