Metlife - AIG - ANB Cooperative Insurance Co.'s board proposed to reduce the company's capital by 48.57% to 180 million Saudi Arabian riyals from 350 million riyals through the cancellation of 17 million shares.
The move aims to restructure the company's capital to offset 170 million riyals in accumulated losses, in line with Saudi Arabia's new Companies Law, Argaam reported Feb. 19.
The Saudi Capital Market Authority decided in 2017 that listed companies with accumulated losses above 50% of capital will face liquidation unless they improve their financial position, Argaam noted.
The capital reduction is pending approval from shareholders in the company's extraordinary general assembly meeting, the date of which will be determined later, and from official authorities.
All fractional shares resulting from the capital cut will be sold, and proceeds will be distributed to eligible shareholders.
The shareholding percentage of each shareholder will not change as a result of the capital reduction, the company said Feb. 19, adding that the total value of shareholders' investment will also not change.
As of Feb. 19, US$1 was equivalent to 3.75 Saudi Arabian riyals.