Saudi regulator clears SAR 680 million rights issue for Almasane Alkobra

Saudi Arabia's Capital Market Authority (CMA) has approved a SAR 680 million rights issue by Almasane Alkobra Mining Company, one of four equity capital increases it cleared between 21 September and 5 October, the regulator said in an announcement of 5 October.

The rights issue is open only to shareholders registered with the Securities Depository Center at the close of the second trading day after the company's extraordinary general assembly, whose date the board will set later. The offer price and the number of new shares will be fixed after the market closes on the day of that meeting, and the prospectus will be published at a later date, the CMA said. The regulator said it reviewed the application against the quantitative and qualitative criteria that apply to all companies seeking a capital increase.

Three other capital increases

On 21 September the CMA approved Allied Cooperative Insurance Group's request to raise its capital from SAR 291 million to SAR 300 million by offering 900,000 shares worth SAR 9 million with pre-emptive rights suspended. The shares can be offered only to the investor categories set out in the Rules on the Offer of Securities and Continuing Obligations, and the approval lapses unless an extraordinary general assembly backs the increase within six months, the CMA said in its announcement.

The same day, the regulator approved Retal Urban Development's request to increase its capital from SAR 500 million to SAR 555 million by issuing 55 million ordinary shares as consideration for a 47.5 per cent stake in Ajdan Real Estate Development Company. Retal must publish a shareholder circular, including the risk factors, in good time before the extraordinary general assembly that will vote on the increase, the CMA said.

The regulator's announcements page also shows that it approved a bonus share issue by Ades Holding Company on 21 September, and the publication of an offer document from Knauf International to acquire all the shares of United Mining Industries Company.

Funds and sukuk products

Alongside the share deals, the CMA cleared several public funds. It approved the public offering of the anb capital Perpetual Sukuk Fund, managed by ANB Capital, on 22 September, its announcement said. Its announcements page lists approvals for the Al Rajhi Sukuk distribution Fund on 17 September, the SNB Capital Princess Nourah University Waqf Fund on 24 September and the PIC Saudi Equity Fund on 5 October, as well as new licences for investment managers and advisers including EQCM, Digital Two Financial, Sadin Investments and Khwarizmi Capital between 1 and 15 October.

In each of its approvals the CMA repeated that its decision means only that the legal requirements of the Capital Market Law and its implementing regulations have been met, and should not be read as a recommendation to invest. It told investors to read the prospectus, circular or fund terms before deciding, according to the rights issue notice and the fund approval.

Rules in consultation

The approvals come while the CMA is consulting on several changes to market rules. Between 22 and 29 September it called for comments on draft provisions to enhance IPO practices, restrictions on algorithmic trading, dealing activities in financial markets outside the Kingdom and earnings calls, and on 29 September it approved enhancements to audit quality for supervised entities, it said on its announcements page.

For the issuers, the next steps sit with shareholders. Almasane Alkobra, Allied Cooperative and Retal each need an extraordinary general assembly to approve their increases, and in Almasane's case the meeting date will also set the record date and the pricing of the rights.