Global investment platform BlueFive Capital has signed a binding share subscription agreement with Gulf General Cooperative Insurance Company (GGI), a company listed on the Saudi Arabian Stock Exchange.
This strategic move aims to restructure GGI’s share capital to strengthen its financial position, starting with the cancellation of 176 million Saudi riyals of share capital, increasing the share capital from 300 million Saudi riyals to 124 million Saudi riyals, and canceling 17.6 million shares, which will eliminate most of the insurance company’s accumulated losses.
Thereafter, GGI will increase its share capital to SAR 300 million through the issuance of 17.6 million new shares, of which 12.6 million new shares (42% of GGI after the restructuring) will be issued to BlueFive or entities it controls.
An additional 5 million new shares will be issued to GGI’s major shareholders to capitalize their previous SAR 50 million loan to the company.
Completion remains subject to the receipt of necessary regulatory and shareholder approvals and the satisfaction of the conditions set out in the share subscription agreement.
BlueFive Capital aims to make GGI “the first global insurance leader to emerge from the Middle East.” The strategy focuses on integrating smaller insurance and reinsurance operators and ecosystem players while capturing high-growth greenfield opportunities.
The platform is designed to deliver long-term value creation through enhanced technology capabilities, digital and operational transformation and the development of strategic and operational synergies across the platform, supported by a disciplined approach to M&A execution and capital deployment.
BlueFive Capital explained that leveraging the group’s asset management expertise, the platform will pursue a targeted buy and build strategy, initially focusing on the GCC before expanding to other high-growth markets, prioritizing Shariah-compliant players.
Hazem Ben-Gacem, founder and CEO of BlueFive Capital, commented: “We are pleased to propose this investment in GGI, which aims to realign the company’s financial position and provide a clear path to sustainable growth.
“GGI is the first step in our vision to create the Middle East’s first global insurance leader. We see tremendous opportunity in the Saudi insurance market and we look forward to working with GGI to enhance its market position and create significant long-term value for shareholders and policyholders.”
Mazen Hani Zaki Altamimi, Chairman of Gulf General Cooperative Insurance Company, said: “This agreement marks a critical moment for GGI. The Board believes that this restructuring, supported by BlueFive’s strategic investment, provides the best way to strengthen our financial position and serve our policyholders.”
“We believe this partnership will unlock new opportunities and drive sustainable growth for the company and all stakeholders. We would also like to sincerely thank the Insurance Regulatory Authority and the Capital Markets Authority for their continued guidance and support throughout the process and look forward to their continued collaboration as we progress this partnership.”
BlueFive Capital acted as advisor to SNB Capital and A&O Shearman, and GIB Capital and AS&H Clifford Chance acted as agents for GGI.