DOHA: Doha Insurance received regulatory approval for the issuance of 24.26 million new shares to shareholders through a rights issue.
The company would seek the approval of the shareholders at the next Extraordinary General Assembly expected to be held on February 17, 2014, the company said in a filing to Qatar Exchange (QE) yesterday.
Sheikh Nawaf bin Nasser bin Khaled Al Thani (pictured), Chairman of Doha Insurance, said: “The company has received lately the written approval - in principle - from both Qatar Central Bank (QCB) and the Ministry of Economy and Commerce to increase the capital of the company from QR257.4m to QR500m by issuing 24,260,000 new shares to the shareholders through a rights issue offered at QR18 per share, QR10 being par value and a premium of QR8.”
Sheikh Nawaf said the company is currently in the process of arranging to convene the next Extraordinary General Assembly for the purpose of seeking shareholders’ approval of the capital increase.
The new rights issue comes as part of the company’s vision to increase financial solvency and further improve its credit rating. “We hope this would enable company to be in a better position to compete for a considerable stake in the mega projects both locally and internationally,” he said.
Reuters reported Doha Insurance would seek shareholder approval next month for the capital increase worth QR436.7m ($119.9m), with the cash aimed at strengthening its ability to work at home and abroad. The move wills nearly double its capital.
Qatar is in the midst of a construction boom with the country planning to spend as much as $140bn on infrastructure projects, including a new airport, stadiums, roads and railways, as it prepares to host the World Cup in 2022.
The insurer has no state ownership, according to Zawya, a Thomson Reuters unit. This is in contrast to most other insurance and financial services firms listed in the country, who are partially owned by sovereign investment funds.
Last February, shareholders of Qatar Insurance approved a QR963.2m rights issue as well as a 20 percent stake sale to Qatar Holding, a unit of sovereign wealth fund Qatar Investment Authority.