The Mediterranean and Gulf Cooperative Insurance and Reinsurance Company (MEDGULF) has approved a 31.6% capital increase as part of its plan to finalize the merger with Buruj Cooperative Insurance Company.
In an interview with Al Arabiya Business, Umar Al Mahmoud, CEO of MEDGULF, said the main objective of the merger is to strengthen the company’s financial solvency and create a larger entity capable of expanding its presence in the Saudi insurance market.
Al Mahmoud emphasized that the Saudi insurance sector needs larger and more diversified players to keep pace with the evolving requirements of the next phase of economic development.
He added that there are significant opportunities to improve profit margins following the merger, supported by government exemptions and reduced operating costs.
As for the company’s future operational strategy, Al Mahmoud explained that MEDGULF aims to offset the decline in its shareholders’ ownership percentage after the merger by creating added value for investors through growth and efficiency initiatives.