SHUAA Capital psc (DFM: SHUAA), the leading asset management and investment banking platform in the region, announced today its intention to increase its issued share capital through a Rights Issue following initial approval from the Board.
The Rights Issue will be immediately preceded by a capital reduction and exchange offer to noteholders of its bond maturing in October 2023, subject to approvals from shareholders and relevant regulatory authorities.
The Company intends to use the capital optimisation to reposition itself for growth with the following key objectives:
- Improvement and sustainability of profitability metrics befitting a leading financial services player
- Significantly de-risk business through debt reduction and restore balance sheet health with appropriate and sustainable debt ratios
- Position the company for future dividend distributions to shareholders unencumbered by elevated finance costs and debt service requirements
- Enable participation from existing shareholders and new investors in SHUAA’s growth story while also increasing the free float of SHUAA’s shareholding to increase liquidity
SHUAA aims to complete the capital optimisation by the end of this year, conditional on obtaining the necessary regulatory and shareholder approvals. Full details will be made available as part of a Shareholders’ General Assembly to be called in due course.
Fawad Tariq Khan, Group CEO of SHUAA Capital said, “We have received positive feedback so far from our existing valued stakeholders and are pleased to provide the opportunity for all eligible shareholders to participate in our continued growth. SHUAA remains fully dedicated to managing this process diligently, and we aim to work closely with various stakeholders to ensure the success of the capital increase. The Rights Issue is one step in a series of actions, which SHUAA will be implementing going forward within a new strategy to reposition SHUAA for growth.”
Houlihan Lokey is advising SHUAA regarding structuring, sizing, and pricing of the recapitalisation, and Baker Botts has been appointed as Legal Adviser.