Methaq - Bin Salam buys 40%

[sharewadi]

Bin Salem Group (BSG) has bought 40% of Mithaq / Methaq Takaful Insurance (METHAQ) according to a statement on the Abu Dhabi stock market (ADX) website but no further information was disclosed. Which I find especially odd because Methaq are one of the very few companies that send regular emails to sharewadi.com with information updates.

Presumably today's disclosure had something to do with the massive trading volume in Methaq shares seen on 16 December 2008 - 35m shares (since the beginning of November there has been only one other day with volume of more than 1m shares), and stock price jumped 8.1% to AED3.60. Although even if that was all buying by Bin Salem Group, that's still only 23% of the total 150m shares outstanding. Presumably they bought the rest prior to that date, another 25m shares at least. During September and October there were a few days with heavy volumes, with one day of over 72m shares traded.

Bin Salam Group are paying a high price for their stake if they've been buying at market prices though, or was BSG one of the founder shareholders? Methaq high since listing was AED 8.55 on 15 October 2008. Price has plummeted since then to a low of AED 3.11 at the end of last week. But that's still much more expensive than the other two Islamic insurance companies that had IPOs and listed this year - Dar Takaful (DARTAKAFUL) and Takaful Emarat (TAKAFUL-EM), which both closed at around AED 1.20 on Thursday.

Methaq shares so far this morning have plunged 8.4% to 2.85 in early trading this morning but with minimal activity, and they're following the ADX index which is down over 3% so far.

ADX 21 December 2008:

(METHAQ) BIn Salem Group Owns 40% from Methaq Co.

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