The fixed line provider, which is 15 percent-owned by Bahrain Telecommunications Co, now has accumulated losses of 95 percent of its capital, according to a statement on the Saudi bourse website.
Saudi market rules call for a suspension if losses exceed 75 percent.
“The company incurred in the recent period large losses of capital as a result of uncompetitive behavior and practices from the controlling operator,” Atheeb chairman Prince Abdul-Aziz Ahmed bin Abdul-Aziz said in a statement to Reuters.
“The company was prevented from offering some services such as international calls and prepaid cards as stipulated in the license.”
He also blamed the telecoms regulator, the Communication and Information Technology Commission, saying a hearing against this body would be held on May 28.
In February, Atheeb filed a case against incumbent Saudi Telecom Co, claiming it had breached anti-monopoly laws. STC refuted the allegations.
Atheeb posted a loss of SR575 million ($153.3 million) for the financial year ended March 31, prompting the Capital Market Authority (CMA) to halt trading in the shares from Wednesday.
The suspension will be in place “until the company changes its situation,” the statement said.
Atheeb’s board has recommended cutting its capital to SR400 million from SR1 billion to wipe out some of its losses. This will likely be followed by a SR600 million rights issue, Abdul-Aziz added, with the founding shareholders pledging to cover 65 percent of the rights issue.
Atheeb’s shares ended Tuesday at SR7.75. Their par value is SR10 and market rules prevent listed companies from issuing new shares at below this price.
The firm has six months to act, otherwise the CMA could delist Atheeb if it believes “the level of operations for the issuer or its assets do not justify continuous trading of securities on the bourse.”
Atheeb, which operates under the brand name GO, was awarded a Saudi fixed line services license in 2009.
