Al Kathiri Holding mulls 61% capital reduction to write off accumulated losses

Al Kathiri Holding Company plans to cut its share capital by 61.27% to erase accumulated losses, the company said in a bourse filing on the Saudi Exchange (Tadawul).

The board recommended the reduction during a meeting on 1 July 2026. The proposal would lower paid-up capital from SAR 113 million to SAR 43.77 million, a reduction of SAR 69.24 million. Outstanding shares would drop from 226.04 million to about 87.55 million through the cancellation of 138.48 million shares. For every share held, roughly 0.613 shares would be cancelled.

The move is a balance-sheet adjustment, the company said. It is not expected to affect financial, operational, or regulatory obligations. Day-to-day operations and performance should continue without disruption. Existing liabilities remain unchanged.

The reduction still needs approval from the Capital Market Authority (CMA) and other Saudi regulators. After that, the proposal goes to an Extraordinary General Assembly for a shareholder vote. The effective date would be the end of the second trading day after the EGM approves the resolution.

Al Kathiri has not yet appointed a financial advisor to manage the process. The company said it will announce the advisor and the CMA application filing once those steps are reached.

The restructuring follows standard procedures for Saudi-listed companies that need to reset their capital base after accumulated losses. The goal is to align capital structure with current financial realities and comply with regulations governing firms with significant accumulated losses.