AIICO Insurance notifies NSE of N3.5bn proposed rights issue

AIICO Insurance Plc on Monday notified the Nigerian Stock Exchange (NSE) of a proposed N3.5billion rights issue.

The Head, Listings Regulation, NSE, Godstime Iwenekhai in a statement said, “ Dealing Members are hereby notified that AIICO Insurance Plc has through its Joint Stockbrokers, Magnartis Finance and Investment Limited and Stanbic IBTC Stockbrokers Limited submitted an application to The Nigerian Stock Exchange for the approval and listing of a Rights Issue of 4,357,770,954 ordinary shares of N0.50 each at N0.80 per share, on the basis of five new ordinary shares for every 13 ordinary shares held.

“The Qualification Date for the Rights Issue is today Monday, 15 June 2020.”

The Insurance company in order to meet the new capital base directed by the National Insurance Commission (NAICOM) had proposed plans to raise fresh funds.

The company had said it is to raise additional capital to meet the regulatory requirements of N18 billion capital base.

The company said it intends to raise N3.5 billion or more by way of a rights issue. The plan was presented at the Extra-Ordinary General Meeting of AIICO Insurance held in March 5, 2020.

The fundraising is, however, still subject to the approval of regulatory authorities.

It had earlier been reported that the new capital structure for Life, Non-Life and Composite insurance companies, including reinsurance companies, were increased from N2 billion, N3 billion, N5 billion and N10 billion to N8 billion, N10 billion, N18 billion and N20 billion respectively.

In the statement published on the NSE, AIICO Insurance stated that at the Extra-Ordinary General Meeting, a resolution will be passed on the proposal.

It stated, “subject to the approval of regulatory authorities and pursuant to Article 44 of the Articles of Association of the Company, the directors of the Company are hereby authorised, by way of a rights issue, additional capital of up to N3.5 billion or any higher amount to be determined by the Board of Directors by way of issuance of ordinary shares to the existing shareholders of the Company upon such terms and conditions as to size and pricing as the Board of Directors may deem fit.”

It added that “the additional shares to be issued by the Company by way of a rights issue shall rank in pari passu with the ordinary shares held by the existing shareholders of the Company.”

AIICO Insurance has until December 31, 2020, to meet the new capital base after the insurance regulator postponed the June 2020 deadline.