Gulf Union recommends capital cut

The board of directors of Gulf Union Cooperative Insurance Co. on Tuesday recommended a 31.82 percent capital reduction to SAR 150 million from SAR 220 million.

The insurer will write off one share for every 3.14286 outstanding shares, the company said in a statement to the Saudi bourse Tadawul, on Wednesday.

The move is aimed at restructuring the company’s capital in compliance with the new corporate law.

The capital cut, which is subject to approval of the regulatory authorities and shareholders at the upcoming extraordinary general assembly meeting, will have no material impact on the company’s liabilities, Gulf Union added.

Meanwhile, shareholders’ stakes will remain unchanged after the capital reduction.

A financial advisor will be hired after fulfilling the required regulatory procedures, the statement added.