Saudi Arabia’s Public Investment Fund (PIF) has acquired a 23.08% stake in Saudi Reinsurance Company (Saudi Re), which is in line with a strategy to strengthen the country’s insurance sector.

The investment, which is also expected to help the reinsurer boost its capacity and credit rating, was through a capital increase and share subscription, the sovereign wealth fund confirmed on Monday.

“By investing in Saudi Re, PIF is reinforcing [the regional insurer] and strengthening Saudi Arabia’s insurance sector,” said Sultan Alsheikh, Head of Financial Institutions in MENA Investments at PIF.

“This enhances access to quality financial services for insurers and their policyholders, and strengthens the sector.”

Last July 2024, the two parties signed a subscription deal in which Saudi Re would raise its capital to more than SAR 1.15 billion by issuing 26.73 million new ordinary shares to the sovereign wealth fund in exchange for a 23.08% stake.

PIF had agreed to pay a subscription amount of SAR 16 per share, pegging the total investment at SAR427.68 million.

The reinsurer has an A-minus rating from S&P and an A3 rating from Moody’s.

(Writing by Cleofe Maceda; editing by Seban Scaria ) seban.scaria@lseg.com