Riyadh: Saudi Arabia's Capital Market Authority (CMA) has approved the initial public offerings (IPO) of four new insurance companies to raise a total of 260 million Saudi riyals (Dh254.7 million). The IPOs will take place next month.
The companies are AXA for Cooperative Insurance, ACE Arabia for Cooperative Insurance, Weqaya Takaful Insurance and Reinsurance and Al-Rajhi Company for Cooperative Insurance. The offer price will be 10 riyals per share and the period will be from April 18 to April 27, the CMA said in a press statement.
The IPO will be launched collectively by the four companies. AXA for Cooperative Insurance, with a capital of 200 million riyals, will offer 80 million shares to the public, which represent 40 per cent of the company shares. ACE Arabia for Cooperative Insurance, with a capital of 100 million riyals, will offer 40 million shares, or 40 per cent of the company shares.
Weqaya Takaful Insurance, with a capital of 200 million riyals, will offer 80 million shares, which represent 40 per cent of the company shares. The CMA said that the fourth company, Al Rajhi Company for Cooperative Insurance with a capital of 200 million riyals, will offer 60 million shares or 30 per cent of the company shares to the public.
According to the CMA, three local banks will be chosen to manage the IPO of each one of the four companies, and their names will be announced in due course.
"Each company shall release a bulletin with details of the company and the advantages that the investors would get by taking possession of its shares. The bulletin shall consist of the financial statement as well as relevant information with regard to its activities and management," the CMA statement said, adding that the bulletin shall be published prior to launching the IPO.
According to the latest figures released by the Saudi Arabian Monetary Agency, the central bank, about 542 million shares were traded in the insurance sector during the month of January.