Mubasher: Gulf Cement Co. has obtained the approval of the Securities and Commodities Authority (SCA) in the UAE to cut its issued capital to AED 410.55 million from AED 821.1 million.
To reduce its issued capital, 410.55 million shares will be cancelled from the issued shares of the company, according to the company's disclosure to the Abu Dhabi Securities Exchange (ADX) on Tuesday.
The capital reduction will help in extinguishing the company's accumulated losses, which cannot be compensated for from future profits in the short and medium-term.
Reducing the capital will offer a surplus of the legal reserve amounting to AED 159.183 million and transferring it to the voluntary reserve to record AED 163.916 million.
Hence, an optional reserve of 39.9% of the capital that can be distributed upon the availability of the company's liquidity will be provided.
The financial impact of the capital cut will be registered in the company's financials for the period ending on 31 December 2020.