Ahead of the 30th of June 2020 deadline given to insurance companies in the country to recapitalise to a new threshold, Consolidated Hallmark Insurance (CHI) has secured shareholders’ approval to raise N4.5 billion additional capital to shore-up its minimum paid-up capital to N10 billion.
The shareholders, at the Extra-Ordinary General Meeting (EGM) held recently in Lagos, equally approved that the Company’s authorised share capital be increased from N7.5 billion divided into 15 billion Ordinary shares of 50 Kobo each to N10 billion divided into 20 billion Ordinary shares of 50 Kobo each with the creation of additional 5 billion Ordinary shares of 50 Kobo each.
While the shareholders authorised the company to raise additional capital of up to N1.056billion through a Right Issue of 2.032 billion units to the ratio of 1:4 at N0.52 per share, they equally approved consented to the plan of the company to raise N4.5 billion, whether by way of private/public, special offering, right issue or a combination or other methods the company deemed fit. N4.5 billion or its equivalent whether locally or internationally or a combination of both, through the issuance of shares, long term debt, preference shares (redeemable or irredeemable), convertible and non-convertible securities or depository receipts or any other instrument(s) , whether as a standalone transaction, or a combination which may be determined by the Directors for such consideration and upon such terms and conditions as the Directors may deem fit; subject to obtaining the approvals of relevant regulatory authorities.
Addressing the shareholders, the chairman of the insurance firm, Obinna Ekezie, said, the National Insurance Commission (NAICOM) had earlier announced over 200 per cent increase in capital from N3billion to N10billion for underwriters operating in the general business category, which CHI falls into.
The meeting, meh stressed, was a culmination of series of plans to ensure full recapitalisation of the company ahead of the stipulated deadline of June 2020, adding that, the insurer is on the verge of being granted an operational license by NAICOM to operate a Micro-Life Insurance subsidiary.
Statutory deposit and license application fee, according to him, have been paid to the Central Bank of Nigeria and NAICOM respectively, while the anticipated commencement date of full operations by this subsidiary is early in the new year.
“We believe firmly that with your(shareholders) approval and continued support, your company will emerge a stronger and more formidable player in the sector, adequately equipped to meet the growing needs of our rapidly expanding clientele and with the ability to retain a higher proportion of risks hitherto ceded,” he pointed out.