Dubai-based Takaful Emarat, a shariah-compliant life and health takaful provider, has announced that its rights issue opens today (November 1) and is tradable on Dubai Financial Market until November 15.

Trading of the rights Issue enables existing shareholders of the company who do not wish to subscribe to the new shares, which the company plans to issue as part of its capital increase, to sell all or part of their rights to other investors who do wish to subscribe, a company statement said.

The subscription for newly issued shares will open on November 9 and will close on November 22. Takaful Emarat has published the schedule for the subscription process as required by law, and informed its shareholders through newspaper announcement on how to exercise their rights to subscribe for shares or trade the rights, according to the statement.

Subscription shall be received by National Bank of Abu Dhabi through its branches announced in the newspaper.

The proposed capital raise will increase the Company’s capital by Dh50 million ($13.6 million) initially, with approval from shareholders to raise up to Dh100 million.

The proceeds will be used to accelerate Takaful Emarat’s growth momentum and capitalize on the Company’s recent restructuring under a new management team and its return to operating a profitable underwriting model.

Takaful Emarat delivered the highest increase percentage in net earned contributions of 271 per cent for the half year ended June 2015 to reach its net earned contributions to Dh141 million up from Dh38 million for the half year ended June 2014, said a recent report by Taha Actuaries & Consultants.

In particular funds will be used to strengthen Takaful Emarat’s back office function, grow and develop its distribution channels and sales network across the UAE and invest in the Company’s digital and interactive client service technologies to ensure optimal customer service and efficient policy management.

The company is uniquely well-positioned to capitalize on the roll out of mandatory health insurance in Dubai, and the increased uptake of Takaful insurance in the region, which is forecast to grow as insurance penetration deepens, the statement said.

 By 2017, the global gross Takaful market is expected to reach $20 billion, up from current estimates of $14 billion, according to EY.

“We are pleased to be the first sharia compliant insurance company in the UAE to issue rights that can be publicly traded on an exchange,” said Takaful Emarat’s chief executive officer Wael Al-Sharif.

“As a business, we have been completely restructured over the last 24 months and we are now well positioned to continue our growth trajectory as we focus on delivering maximum value for our shareholders and investors,” he added. – TradeArabia News Service