Saudi Telecom said its board had proposed increasing its capital by 30 billion riyals ($8 billion) to finance growth and expansion plans in its home market, Saudi Arabia, and elsewhere in the region.
Saudi telecom board proposes an $8 billion capital increase of 150%, with shareholders offering 1.5 new shares for each share they owned. The announcement was made in a statement published to the Saudi stock market. Saudi Arabia’s government owns 64% of the major telecom through its sovereign wealth fund, the Public Investment Fund.
In a separate statement, Saudi Telecom said its board had recommended cutting its dividend policy which committed it to 1 riyal $0.26) per share per quarter to 0.40 riyal ($0.10). The statement said the board proposed the change in the three-year dividend policy, which had been in effect since the fourth quarter last year, in response to the proposed share capital increase.
“This increase will undoubtedly lead to enhancing the liquidity in the company’s shares and make them more accessible to a wider group of investors,” chairman of the board of directors Prince Mohammad bin Khalid Al-Abdullah Al-Faisal said.
Saudi Telecom said in a statement the capital increase through retained earnings would support growth and expansion plans. Under the proposal, the three-year dividend policy in place since the fourth quarter of 2021 would be cut from a 1 riyal ($0.26) payment per share per quarter to 0.40 riyal ($0.10). The board would continue to consider additional dividend payments, it said.
