Saudi Insurers' Shares Start Flat Following Merger Agreement

Shares of Al Sagr Cooperative Insurance Co. and Gulf Union Al Ahlia Cooperative Insurance Co. were flat on Tuesday, opening at SR9.79 (US$2.6) and SR9 (US$2.39), respectively, after they signed an memorandum of understanding to discuss a potential merger between the two companies.

After the proposed merger is completed, Gulf Union Alahlia will issue new shares to Al Sagr Insurance shareholders in exchange for all issued shares of Al Sagr, according to a bourse filing. After Gulf Union Alahlia and Al Sagr have conducted all necessary due diligence, the firms will determine the share-for-share exchange ratio. Al Sagr hired Alinma Investment to act as its financial advisor for the proposal.