Riyadh – Mubasher: The board of Touristic Enterprises Company (Shams) recommended on 24 August to reduce the capital by cancelling 4.89 million shares to offset accumulated losses worth SAR 48.93 million.

The capital will stand at SAR 52.56 million distributed over 5.25 million shares, compared to SAR 101.5 million and 10.15 million shares prior to the cut, according to a bourse filing on Tuesday.

Shams’ board also decided to increase the capital by 600% through a rights issue of SAR 315.4 million through the issuance of six shares for every existing share.

The capital will amount to SAR 367.96 million distributed over 36.79 million shares after the raise transaction.

Through this capital hike, Shams aims to support the working capital, enhance financial solvency, and rehabilitate the current resort located in the Eastern Province while entering into investments in the tourism sector.

Earlier this year, the board proposed decreasing the capital by SAR 34.51 million to offset the accumulated losses.