RIYADH: Saudi Arabia’s Public Investment Fund has acquired a 23.08 percent stake in Saudi Reinsurance Co. through a capital increase and subscription to new shares.
The deal, originally signed in July 2024, raises Saudi Re’s capital from SR891 million ($237 million) to SR1.15 billion, a move aimed at enhancing the insurer’s financial stability and credit ratings.
The investment, which received regulatory approval and shareholder consent, is expected to strengthen Saudi Re’s position as the national reinsurer significantly, according to a press release.
The move aligns with the Kingdom’s broader commitment to bolstering its insurance sector in line with the goals of Vision 2030.
By retaining more premiums domestically, Saudi Re will contribute to the growth of the Saudi reinsurance market and improve risk management for local insurers.
Sultan Alsheikh, head of financial institutions at PIF, said: “By investing in Saudi Re, PIF is reinforcing a leading regional reinsurer and strengthening Saudi Arabia’s insurance sector, which is an essential component of sustainable economic growth.”
He added: “This enhances access to quality financial services for insurers and their policyholders, and strengthens the sector.”
Arab News previously reported that Saudi Re’s capital increase would be funded by the issuance of 26.73 million new shares, valued at SR10 each, according to a bourse filing at the time. Representing 30 percent of the company’s capital, the shares were to be fully subscribed by PIF at SR16 per share, totalling SR427.68 million.
“We are delighted to welcome PIF as a strategic investor and look forward to its role in enabling Saudi Re’s strategy and reinforcing its position as a national reinsurer, while further strengthening its presence regionally and globally,” said Ahmed Al-Jabr, CEO of Saudi Re.
“This investment will provide us with multiple benefits, including boosting our financial position and unlocking opportunities for expansion and growth,” he added.
Saudi Re, listed in the Saudi Market Exchange, operates in over 40 countries across the Middle East, Asia, Africa and Lloyd’s market in the UK. It holds high credit ratings, including an A-minus from S&P Global and an A3 from Moody’s.
In the first nine months of 2024, the company recorded total written premiums of SR1.94 billion ($520 million), with a compound annual growth rate of 17 percent over the past five years.
The investment aligns with PIF’s broader strategy under Vision 2030 to foster economic diversification and create partnerships that promote local content.
The fund’s strategy, as set out in the PIF Program 2021-2025 — one of the Vision 2030 realization programs — aims to enable many promising sectors and contribute to increasing local content by creating partnerships with the private sector.
By scaling up Saudi Re’s capacity to meet the rising demand for reinsurance solutions, PIF is contributing to the development of a robust and innovative insurance ecosystem in Saudi Arabia.
