Kuwait City, May 05: Shareholders of Global Investment House, a leading Kuwaiti investment firm that is restructuring its debt, approved on Wednesday a recommendation to raise its capital.
The increase will be 100 million dinars (346 million dollars), or 76 percent of the current paid-up capital of 454 million dollars, chairwoman Maha al-Ghuneim told reporters.
The hike, for which no date has been set, will be made through a rights issue of one billion new shares, each with a nominal value of 0.35 dollars and a premium of 0.017 dollars.
Ghuneim said aim is to enhance Global’s financial position and safeguard it against what could happen if the value of assets does not improve in the future.
The company has been severely hit by the global financial crisis and, in December 2008, defaulted on all of its estimated three billion dollars in debt.
But it has continued to pay interest. Last December it struck a deal with creditors to restructure 1.73 billion dollars in debt, promising to repay all the loans within three years.
Ghuneim said the company made the first payment of 29 million dollars on time on April 21. She also said Global has disposed off some of its assets but provided no details.
Last year, Global posted a loss of 516 million dollars following a shortfall of 894 million dollars in 2008.
Assets dropped to 2.9 billion dollars from 4.35 billion dollars, and assets under management fell to 5.9 billion dollars from 7.6 billion dollars.
Investment companies in Kuwait have faced difficulties repaying their debt with the tightening of credit opportunities due to the global financial crisis.
—Agencies