Samsung Engineering said on Monday that it pledged 213.44 billion won ($198.4 million) to take part in the recapitalization scheme of purchasing 300,000 rights offering in Samsung Saudi Arabia to finance the operation of the local unit.

Samsung Engineering plans to complete the transaction by April 22, 2019. The Korean engineering company owns a 99.98 percent stake in the subsidiary and the remainder is held by Samsung India Private.

The decision comes after Samsung Engineering released a vision of long-term growth in the Saudi market where its local operations posted losses.

Samsung Engineering operates mainly in Saudi Arabia, Shanghai, Vietnam and Malaysia, but losses in its Saudi entity caused challenges to the company’s organic growth. Samsung Saudi Arabia reported losses of 205.1 billion won in 2014, 361.1 billion won in 2015 and 139.4 billion won in 2016 due to political instability in the Middle East.

Shares of Samsung Engineering finished Tuesday up 1.7 percent at 17,750 won.

By Yong Hwan-jin and Minu Kim

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