According to industry sources, several London brokers have decided to cancel existing risks mid-term underwritten by Arab Insurance Group (ARIG) and have gone to replace them with other underwriters in London and internationally.
ARIG security has been temporarily suspended from trading on the London Stock Exchange from August 27, 2002 at the request of the company.
Earlier this week, it was reported that the troubled company expected to raise $100 million by 15 September in a rights issue that it tied to the writing off of $283 million of accumulated losses through the reissuing of its existing shares.
The Bahrain-based re-insurer posted an $8.3 million net loss in the first half of this year on gross premiums of $124.7 million. In the full year 2001, it posted an $88.3 million net loss on gross premiums of $206.6 million.
Arig's rights issue, at a nominal $1/share, was scheduled to run from 1-15 September and a new board of directors is to be elected at the group's annual meeting on 29 September. Arig's founding shareholders are the governments of Kuwait, the United Arab Emirates and Libya, each with a 16.5% stake before the rights issue.
Formed in 1980, Arig is currently the largest reinsurance operation in the Middle East. The company has overseas offices in Tunisia, Kuala Lumpur, Hong Kong and Seoul. The Group operates subsidiaries in Morocco, Jordan, and Egypt and Tunisia.
Arig expanded its capital to $360 million in 1997 by issuing shares to investors in the Arab world. Kuwait, the United Arab Emirates and Libya each hold a 16.3 percent stake in ARIG, whose shares are traded on the Bahraini, Omani, Kuwaiti and Egyptian stock markets. Its global depository receipts are listed on the London Stock Exchange. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
