The Saudi Stock Exchange (Tadawul) has announced the suspension of trading in Buruj Insurance Company (Buruj) shares, pending the commencement of procedures to delist the stock permanently, following the merger of Buruj with the Mediterranean and Gulf Insurance and Reinsurance Cooperative Company (MedGulf).
Shareholders of both companies approved the merger at extraordinary general assemblies held separately. The deal will see the dissolution of Buruj, which will be absorbed into MedGulf.
Strategic move
MedGulf CEO, Mr Umar Al Mahmoud, said in an exclusive interview with Al Arabiya that the merger represents a strategic step aimed at enhancing financial solvency and establishing a larger insurance entity capable of expanding in the Saudi market. The merger is in response to the market's need for strong entities with diverse products.
He also said, "Buruj has experience in the retail and small and medium-sized enterprises (SME) sector, a sector into which MedGulf has not previously expanded significantly. This gives us a greater opportunity to enter new markets."
He added, "Today, MedGulf, with Buruj, ranks fourth in the Saudi market and third in the medical insurance sector. Financial solvency, human capital, and technological advancements are all factors that support growth opportunities, and we look forward to positive results soon."
The top three insurers in Saudi Arabia, in terms of insurance revenue, are Bupa Arabia, Tawuniya and Al Rajhi.
Merger process
MedGulf will, through a capital increase, issue the consideration shares totalling 33,157,894 shares in MedGulf and allocate them to Buruj shareholders. Under the deal, Buruj shareholders will receive one MedGulf share for every Buruj share they own, resulting in a fully cash-free transaction. The share issuance increases MedGulf’s share capital by 31.58% to SAR1.38bn from SAR1.05bn.
The merger results in the reduction of the stake in MedGulf held by existing shareholders to approximately 76% of MedGulf’s share capital. Buruj’s shareholders will hold approximately 24% of the enlarged capital of MedGulf.
The two companies entered into the merger agreement in July 2025.
In accordance with the agreement, and subject to obtaining the no-objection from the Insurance Authority, two Buruj nominees, Yasser Youssef Mohammed Naghi and Ziad Bassam Mohammed Al Bassam, are appointed to the merged company’s board of directors.