Islamic Arab Insurance Company (SALAMA), a prominent player in the UAE's takaful insurance market, has announced plans to issue mandatory Convertible Sukuk (MCS) as part of its strategic financial initiatives. The decision, set to be approved by the Board of Directors on February 3, 2026, reflects the company's proactive approach to fortifying its capital structure and ensuring sustainable growth.

The issuance of Convertible Sukuk is a significant move for SALAMA, as it aligns with the company's commitment to operating in accordance with Islamic Shari’a principles while also addressing the evolving financial needs of its operations. This strategic financial instrument will not only provide SALAMA with immediate liquidity but also offer investors the opportunity to convert their sukuk into equity, thereby increasing shareholder value in the long term.

In addition to the sukuk issuance, the Board will also deliberate on general business-related matters, which underscores SALAMA's dedication to maintaining robust governance and operational efficiency. This dual focus on financial innovation and business excellence positions SALAMA as a resilient entity in the competitive insurance sector.

Given the promising outlook of the takaful industry in the UAE, coupled with SALAMA's strategic initiatives, investors might consider maintaining their positions in the company. The issuance of Convertible Sukuk is a positive step towards enhancing financial stability and could lead to increased market confidence. Therefore, the recommendation is to hold the instrument for now, as the company's future prospects appear optimistic.