Riyadh – Mubasher: The Saudi Capital Market Authority (CMA) has officially authorized a request from Mohammed Hasan Al Naqool Sons Company to increase its share capital by 100% through the issuance of bonus shares.
The transaction is set to raise the company’s total capital from SAR 29 million to SAR 58 million, according to an official statement.
This regulatory endorsement marks a significant step in the company’s financial restructuring, utilizing internal reserves to strengthen its equity base on the Saudi Exchange (Tadawul).
This expansion will be facilitated through the issuance of one bonus share for every one existing share currently held by shareholders.
To fund this capital hike, the company will transfer SAR 29 million from its retained earnings account directly into its capital account. This process, known as the capitalization of earnings, allows the company to strengthen its financial position without requiring a cash injection from its investor base.
Consequently, the total number of the company’s outstanding shares will rise from 2.90 million to 5.80 million, effectively doubling the volume of shares in the market.
The eligibility for the bonus shares is specifically defined by the company’s shareholder registry. Investors who are registered at the Security Depository Center (Edaa) as of the closing of the second trading day following the maturity date will be entitled to the new shares.
While the CMA has granted its approval, the specific due date for this entitlement is yet to be determined by the company’s board of directors. Once the board sets the date, it will serve as the official timeline for shareholders to qualify for the bonus issuance.
In accordance with the CMA’s regulatory framework, Al Naqool is required to hold an Extraordinary General Assembly within six months from the date of this approval. The assembly serves as a mandatory step for the company to obtain formal shareholder consent and to satisfy all regulatory requirements and applicable laws in the Kingdom. The company must ensure that all legal and administrative procedures are followed to finalize the capital increase within the stipulated timeframe.
The completion of this process remains subject to the final approval of the Extraordinary General Assembly and the fulfillment of all regulatory mandates within the designated six-month window. This strategic move aligns the company’s paid-up capital with its financial accounts, ensuring a more robust balance sheet as it continues its operations in the Saudi market.
