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PIF closer to a significant minority stake in Saudi Re: The Public Investment Fund (PIF) is set to acquire a 23.1% stake in local ins. player Saudi Re after signing a binding agreement that will see it fully subscribe to a capital increase, according to a disclosure to Tadawul. The signing of the binding agreement follows multiple extensions of an MoU signed between the two parties last October
What we know: Saudi Re, which is the Kingdom’s first reins. company, plans to raise its capital by 30% to SAR 1.2 bn by issuing 26.7 mn new ordinary shares (representing 30% of current capital) at a price of SAR 10 per share. Current shareholders will not have the right to buy into the offering. The sovereign fund is set to pour in a total of SAR 427.6 mn to subscribe to Saud Re’s new shares at SAR 16 apiece.
Still hanging: The capital increase remains contingent on non-objection by the Ins. Authority, approvals by the Capital Market Authority and Tadawul and internal approvals at the PIF, according to the disclosure. Saudi Re’s shareholders will also need to approve the increase.
Three PIF-nominated members to join in Saudi Re’s board: The PIF will nominate three members to be appointed to Saudi Re’s board upon the completion of the capital increase, according to the disclosure.
Market reax: Saudi Re’s shares were down 6.7% to SAR 25.80 a piece at yesterday’s market close.
ADVISORS- AlRajhi Capital is advising Saudi Re, while GIB Capital is advising the PIF.
