tadawul-
Element List Explanation
Announcement Detail With reference to the announcement of Saudi Enaya Cooperative Insurance Company published on the Tadawul website regarding the invitation to attend the Extraordinary General Assembly scheduled to be held on 04/01/2026, during which the Board of Directors’ recommendation concerning the merger with Salama Cooperative Insurance Company will be presented for shareholders’ voting, and further to the announcement dated 14 August 2025, which included the execution of the binding Merger Agreement between Saudi Enaya Cooperative Insurance Company and Salama Cooperative Insurance Company, the Company would like to clarify that the Merger Agreement stipulates the merger of Saudi Enaya into Salama through an increase in Salama’s capital by an amount of SAR 188,940,000, by issuing 18,894,000 new ordinary shares in favor of the shareholders of Saudi Enaya. Accordingly, all assets and liabilities of Saudi Enaya will be transferred to Salama upon completion of the merger.
Accordingly, the Company wishes to provide an urgent and important clarification to its shareholders to draw their attention to the fact that this merger has been pursued for the purpose of rectifying the Company’s regulatory status and avoiding the challenges that the Company may face in the event the current merger with Salama is not completed. Failure to complete the merger would result in the continued non-compliance with the minimum statutory capital requirements for insurance companies, which is a mandatory requirement pursuant to Paragraph (5) of Article (3) of the amended Law on the Supervision of Cooperative Insurance Companies, issued under Royal Decree No. (M/12) dated 23/01/1443H, which stipulates that “the paid-up capital shall not be less than SAR 300 million.” In the event of continued non-compliance with the Law issued by Royal Decree, the Company may be subject to severe measures that may not be remediable in the future. This necessitates that shareholders fully appreciate the seriousness of this matter and the importance of cooperating in taking a decision that serves the best interest of the Company, particularly in light of the challenges facing the insurance sector in general and the strict requirements related to compliance with minimum capital requirements in particular.
It should be noted that the Board of Directors of Saudi Enaya has given this matter the utmost attention and has worked directly and intensively with the relevant concerned authorities. The Board has endeavored to propose several optimal options to meet the statutory requirements, in full coordination with the competent regulatory authorities, which included proposing two merger recommendations and one capital increase recommendation to meet the statutory capital requirements, as follows:
First option: Merger with Amana Cooperative Insurance Company, for which the Merger Agreement was signed on 17/09/1442H (corresponding to 29/04/2021); however, this proposal was rejected by shareholders at the Extraordinary General Assembly held on 06/06/1443H (corresponding to 09/01/2022).
Second option: Merger with United Cooperative Assurance Company, for which the Merger Agreement was signed on 11/11/1444H (corresponding to 31/05/2023); this proposal was also rejected by shareholders at the Extraordinary General Assembly held on 21/05/1445H (corresponding to 05/12/2023).
Third option: A recommendation to increase the Company’s capital in order to comply with the minimum statutory capital requirements for insurance companies and to strengthen the Company’s financial solvency; this recommendation was rejected by shareholders at the Extraordinary General Assembly held on 26/05/1446H (corresponding to 28/11/2024).
Accordingly, and in line with the Board of Directors’ responsibilities toward the Company, and its full commitment to safeguarding its interests and avoiding exposure to any future risks or damages, the Board hopes that shareholders will assume their role and demonstrate a sense of responsibility by giving due consideration to the Board’s recommendation to merge with Salama Cooperative Insurance Company, particularly in light of the strategic benefits resulting from the merger, which include enhancing financial solvency and capacity, reducing costs, improving operational efficiency, complying with regulatory requirements, benefiting from incentive exemptions from statutory fees, diversifying products and services, and increasing market share.
Shareholders may refer to the Board of Directors’ circular announced on 04/12/2025, in which the Board outlined the details of the merger.
