Tunis Re to Double Capital to Strengthen Equity and Fuel International Growth

Tunis Re, the Tunisian Reinsurance Company, is set to double its capital from 100 million to 200 million Tunisian dinars (TND). This strategic move aims to bolster its equity base and support its continued international expansion. The capital increase will be achieved through a combination of a reserve incorporation and a cash capital increase.

Responding to Stricter Global Financial Requirements

This operation is primarily driven by the tightening of financial requirements in several foreign markets. Currently, 58% of Tunis Re’s revenue is generated from international operations.

“We are compelled to act quickly,” explained Lamia Ben Mahmoud, CEO of Tunis Re, during the company’s financial communication session. The urgency is also linked to the depreciation of the Tunisian dinar. The current capital of 100 million TND equates to approximately $34 million USD, whereas certain markets now mandate significantly higher capital levels.

Egypt: The minimum required capital reaches $75 million USD, with equity requirements of $125 million USD. Tunis Re was forced to exit this market in 2024.
Jordan: The minimum capital requirement stands at $141 million USD.
Gulf Markets: Some markets impose credit rating requirements that can reach B+.

For Tunis Re, strengthening its equity is therefore essential to preserve access to key markets and sustain its growth trajectory.

A Global Footprint Amidst Local Constraints

Founded in 1981, Tunis Re is now present in over 50 countries, collaborating with more than 500 partners and over 90 reinsurance companies. Its international activities primarily cover the Maghreb, Africa, and Arab countries.

This expansion allows Tunis Re to transcend the limitations of the domestic Tunisian market. While the local market holds significant potential, its size remains limited. According to data presented by the company’s management, the insurance penetration rate in Tunisia does not exceed 2% of GDP.

However, the company faces intense international competition. It must also navigate the challenges posed by its B rating with a stable outlook from Fitch, which has been impacted by the downgrade of Tunisia’s sovereign rating. This country risk limits its access to certain markets that demand higher credit ratings.

Details of the 100 Million TND Capital Increase

The total capital increase of 100 million TND will be structured as follows:

Reserve Incorporation (25 Million TND):
- Issuance of 5 million free shares.
- Ratio: One new share for every existing share.
Cash Capital Increase (75 Million TND):
- Issuance of 15 million new shares.
- Ratio: Three new shares for every four existing shares.
- Price: 8 TND per share (comprising 5 TND nominal value and 3 TND issue premium).

Timeline for Subscription:

Preferential Rights: Reserved for existing shareholders and holders of preferential rights from September 15 to October 2, 2026.
Redistribution Phase: From October 12 to 16, 2026.
Public Offering (if applicable): If the operation is not fully subscribed, a public offering may open from October 26 to 30, 2026.

Strategic Goals: Retention, Growth, and Solvency

Beyond meeting regulatory requirements, Tunis Re intends to utilize these additional equity funds to increase its risk retention capacity.

Risk Retention Rate: Expected to rise from 72% to 79% by 2030.
Revenue Growth: The plan projects an average annual revenue growth of 10.8%, increasing from 243 million TND in 2025 to approximately 405 million TND by the end of the period.
Investments: Expected to grow from 610 million TND to 915 million TND.
Solvency Margin: The average solvency margin is anticipated to reach 198%, well above the regulatory minimum of 100%.

For Tunis Re, doubling its capital is a critical step to consolidate its financial solidity before accelerating its development. In a market where reinsurance capacity is abundant, the company aims to leverage its expertise and strengthen its position in foreign markets.