Saudi Arabian steel producer Al Yamamah Steel Industries Co. has announced that it will participate in a planned capital increase for its subsidiary Al Yamamah Company for Reinforcing Steel Bars following an official request from the subsidiary's board of directors. The subsidiary intends to increase its capital by 300 million Saudi riyals (80 million US dollars), effectively doubling the current capital level, in order to continue the previously announced steel billet production project.
According to a letter submitted by the subsidiary to the Saudi Stock Exchange, the capital increase will be implemented by issuing 25 million shares with rights at a price of 12 Saudi riyals per share.
After reviewing the request, the Board of Directors of Al Yamamah Steel Industries approved a subscription for 6.3 million issued shares. The total investment of 75.6 million Saudi riyals (US$20.16 million) will be fully financed from the internal resources of the parent company.
After the capital increase, Al Yamamah Steel Industries' stake in the subsidiary will be adjusted to 51 percent from the current 72.5 percent, reflecting the impact of the expansion of the shareholder base. Raising capital and changing the ownership structure are subject to all necessary regulatory approvals
.
