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DOHA: The shareholders of Qatar Insurance Company (QIC) have approved plans to increase its capital by 20 percent.
The AGM and EGM of QIC approved the company’s balance sheet and profit and loss account, and distribution of 25 percent cash dividends from the original share value, i.e. QR2.5 for each share. Settlement started from February 18, 2013 through all the branches of Commercial Bank Qatar, a Qatar Exchange filing noted yesterday.
Reuters reported the shareholders have approved plans for a rights issue worth QR963.2m ($264.6m) and to sell a 20-percent stake to sovereign wealth fund Qatar Holding. The company will sell 21.4m new shares to existing shareholders priced at QR45 each.
Like most rights issues in the state, the proposed price is a significant discount to the market price. Qatar Insurance shares closed on Sunday at QR71.6.
The planned capital increase, which still needs regulatory approval, is open to those holding shares on February 14 and will happen once a bonus share issue has been completed.
The bonus share offering, giving shareholders one new share for every five they currently hold, was also approved at the shareholder meeting on Sunday.
Shareholders also backed the planned sale of new shares worth 488.6 million riyals to Qatar Holding, a move approved by the insurer’s board in October.
Qatar Holding’s presence as a strategic partner would strengthen the financial position of the company and help it to compete against major insurance companies elsewhere, the company said at the time.
The Qatari government is already Qatar Insurance’s largest shareholder with a 12-percent stake, according to Thomson Reuters data.