Alinma Tokio Marine details use of right issue proceeds

Alinma Tokio Marine Co. said it has invested SAR 222 million out of the SAR 250 million generated from its rights issue in sukuk, liquidity funds, short-term Murabaha deposits, and the real estate fund.

As direct and indirect costs related to the rights issue amounted to SAR 2.8 million, the net proceeds were SAR 247 million, the company said in a statement to Tadawul on Monday.

An amount of SAR 25 million was placed as statutory deposit following the capital increase.

Due to better negotiation with third parties and control over expenses, the company was able to save SAR 1.1 million in the transaction cost of the capital increase, which was originally estimated at SAR 4 million in the prospectus.

 This saving is now a part of the current account required to maintain the solvency margin.

An amount of SAR 54.46 million was transferred to the policyholders’ funds to finance the deficit for the period, while SAR 46.31 million is available in the shareholders’ current account.

While, the estimated amount of investment in medium to long-term category as disclosed in the prospectus was SAR 77.3 million, only SAR 24.3 million was invested in this category, the statement said. The remaining SAR 53.1 million went towards financing the period’s deficit.

The estimated investment in the short-term category as disclosed in the prospectus was SAR 143.65 million. However, Alinma Tokio Marine has invested only SAR 46.6 million in this category, as SAR 1.4 million went towards financing the policyholders’ deficit and SAR 45.2 million was deposited in the current account to maintain solvency margin.