Walaa Cooperative Insurance Co. signed a binding merger agreement with SABB Takaful on Feb. 24, reflecting the agreement of both companies to merge through a share swap transaction, whereby Walaa will issue 0.6 nominal shares against each issued share in SABB Takaful for the benefit of eligible shareholders.
The insurer said in a bourse filing that this will be in exchange for the transfer of assets and liabilities of SABB Takaful, and without any additional cash consideration being paid.
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Merger Details |
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Method of Merger |
By merging SABB Takaful with Walaa and transferring all SABB Takaful’s assets and liabilities to Walaa. |
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Merger Value |
If the merger will be approved, Walaa will increase its share capital by issuing 20.42 new ordinary shares with a nominal value of SAR 10 per share to SABB Takaful’s entitled shareholders based on the exchange ratio. The value of Walaa’s share capital will accordingly become SAR 850.58, divided into 85.06 nominal shares. |
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Nominal Value |
SAR 10 per share |
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Equity Compensation |
Issuance of 0.6 shares of Walaa against one share in SABB Takaful |
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Capital of Merged Entity |
SAR 850.58 mln |
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Ownership of Walaa Shareholders Upon Merger Completion |
75.99% |
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Ownership of SABB Takaful Shareholders Upon Merger Completion |
24.01% |
Upon completion of the merger transaction, Walaa will become, by operation of law, the legal successor of the assets, liabilities, rights, and obligations of SABB Takaful and SABB Takaful shall cease to exist.
Walaa will announce any material developments regarding the proposed merger process, in accordance with the relevant laws and instructions. In the meantime, the company intends to continue carrying on its business as usual until the completion of the proposed merger.
According to data compiled by Argaam, Walaa and SABB Takaful signed a non-binding memorandum of understanding (MoU), on July 14, to evaluate a potential merger between the two companies.
In January, the companies extended the MoU on the potential merger for 45 days to finalize the due diligence process.
