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Molan Steel Co. has announced a board recommendation to execute a reverse stock split, raising the nominal value of its shares from SAR 1 to SAR 10 per share. This corporate action will effectively reduce the total number of outstanding shares from 26.60 million to 2.66 million while keeping the overall share capital unchanged at SAR 26.60 million. The company's equity closed at SAR 0.85 on September 3.
The decision comes after Molan received an official notification indicating that its average share closing price had fallen below the exchange's minimum mandatory trading threshold. Regulatory guidelines granted the company a three-month grace period starting August 3 to take necessary corrective measures. By implementing the reverse split, Molan aims to elevate its trading price to at least SAR 3 per share to maintain compliance.
Moving forward, the proposal requires formal regulatory approvals from market authorities and subsequent approval from shareholders during an Extraordinary General Meeting (EGM). The EGM vote will proceed unless the market price naturally recovers above the SAR 3 mark within the designated period. Investors on the Nomu parallel market will be closely observing the regulatory voting process and execution dates.
