Cenomi Centers’ board recommends 9% capital increase
CENOMI CENTERS
4321 0.29% 17.20 0.05 2P
7204.B 0.00% 0.00 0.00
Riyadh - Mubasher: Arabian Centres Company (Cenomi Centers) has announced a recommendation from its Board of Directors to increase the company’s share capital by 8.98%.
The proposed expansion, which remains subject to regulatory and shareholder approvals, involves the issuance of bonus shares to existing shareholders and the allocation of new shares for a forthcoming employee incentive scheme.
Under the plan, the company intends to capitalize SAR 712.5 million from its retained earnings to fund the issuance of more than 42.6 million new shares.
The Board of Directors of Cenomi Centers reached the decision during a meeting held on 19 June. According to the official disclosure, the proposal seeks to raise the company’s capital from SAR 4.75 billion to approximately SAR 5.18 billion.
Consequently, the total number of outstanding shares will rise from 475 million to 517.65 million shares. This strategic move is designed to support the company’s long-term growth objectives, strengthen its financial position, and establish a framework for employee retention and performance motivation.
The capital increase is divided into two primary components. The first component is a bonus share issuance directed at the company’s current shareholders.
Cenomi Centers plans to issue 39.58 million new shares, representing an 8.33% increase in capital. This distribution will be executed at a ratio of one bonus share for every twelve shares currently held by investors.
The second component involves the issuance of 3.07 million new shares, representing a 0.65% increase in capital, specifically dedicated to a new employee stock program. The company noted that this program is intended to provide long-term incentives for its workforce, aligning the interests of employees with those of the shareholders and the broader corporate strategy.
To facilitate this capital hike, Cenomi Centers will capitalize SAR 712.5 million from its retained earnings account. This accounting maneuver allows the company to increase its legal capital without requiring a direct cash injection from its shareholders.
Regarding the eligibility for the bonus shares, the company stated that the right of attendance and entitlement will belong to shareholders who own stock at the close of trading on the day of the Extraordinary General Assembly (EGM).
These shareholders must be registered in the company’s registry at the Securities Depository Center (Edaa) by the end of the second trading day following the eligibility date.
In the event of fractional shares resulting from the bonus issue, Cenomi Centers confirmed that these fractions will be consolidated into a single portfolio.
They will subsequently be sold at the prevailing market price, and the resulting proceeds—net of costs—will be distributed to the eligible shareholders on a pro-rata basis. This distribution process is expected to be completed within 30 days from the date the final share entitlements are determined.
The implementation of the capital increase, the bonus share issuance, and the employee stock program are all contingent upon obtaining the necessary approvals from the relevant Saudi regulatory authorities.
Furthermore, the proposal must be ratified by the company’s shareholders during an upcoming Extraordinary General Assembly meeting. During this meeting, the board will also formally present the recommendation to establish the employee stock program for shareholder consideration.
The proposed capital restructuring reflects Cenomi Centers' commitment to balancing shareholder returns with internal reinvestment.
By utilizing retained earnings to expand its capital base, the company aims to fortify its balance sheet while simultaneously introducing a performance-linked equity component for its staff to ensure operational stability and growth.
Source: Mubasher Source: {{details.article.source}}