KSA - AlAhli Takaful, Arabian Shield enter into MoU for potential merger
Wednesday, 04 14 2021, Category: Islamic Insurance, Country: Saudi Arabia
AlAhli Takaful Company and Arabian Shield Cooperative Insurance both signed a memorandum of understanding (MoU) for a potential merger between the two entities, according to two separate disclosures to Tadawul on Sunday.
The companies will start the due diligence process and negotiate over the final terms and conditions for the merger transaction.
When the merger is completed, Arabian Shield will issue new shares to the shareholders of AlAhli Takaful in exchange for every share they hold in the takaful company.
The merged entity will continue to be branded as The Arabian Shield Cooperative Insurance Company and to remain headquartered in Riyadh.
Both companies confirmed that the expected merger would welcome AlAhli Takaful’s entire employees into Arabian Shield. They assured that it will not result in any involuntary redundancies.
Arabian Shield has appointed AlJazira Capital as its financial advisor, while AlAhli Takaful hired Falcom Financial Services Company for the same role.
The takaful company achieved SAR 14.06 million in net profit before Zakat in 2020, which came 2.26% higher than SAR 13.75 million in 2019.
Arabian Shield, meanwhile, has obtained the Saudi Central Bank’s (SAMA) approval to increase the capital by SAR 100 million.