Saudi Arabia: Gulf Union-Al-Ahlia merger takes effect
Source: Middle East Insurance Review | Jan 2021
The merger between Gulf Union Cooperative Insurance (Gulf Union) and Al-Ahlia Cooperative Insurance (Al-Ahlia) has entered into force, according to statements issued by both companies to the Saudi stock exchange Tadawul in December.
The announcements of Gulf Union and Al-Ahlia include the approval of the board of Gulf Union to increase capital for the purpose of concluding the merger deal with the latter. Al-Ahlia’s statement announced the expiry of the creditor objection period with no outstanding unsatisfied creditor objections.
Upon this, all the assets and liabilities of Al-Ahlia will be transferred to Gulf Union, which will issue 7,947,464 ordinary shares with a nominal value of SAR10 ($2.7) per share in favour of Al-Ahlia shareholders by increasing the paid-up capital of Gulf Union from SAR150m to SAR229.47m. This transaction increases the number of shares of Gulf Union from 15m to 22,947,464, an increase of 53% in the company’s paid-up capital.
Gulf Union has stated that the cancellation of the listing of Al-Ahlia shares on Tadawul, the listing of the consideration shares, and deposit of the same in the accounts of the eligible Al-Ahlia shareholders is expected to be completed within a period not exceeding the sixth trading period after this announcement.
The shares of Al-Ahlia have been suspended from trading on the same day as that of issuing the announcements on Tadawul, to start the procedures for cancelling the listing of the company’s shares from the market. M