Management of Sunu Assurances Nigeria Plc has attributed the suspension of trading on its shares at the floor of the Nigerian Stock Exchange (NSE) to its ongoing recapitalisation exercise.
Insurance regulator, the National Insurance Commission (NAICOM), it would be recalled, has mandated insurance companies operating in the country to shore up their paid-up capital, with the first phase ending 31st December 2020 while the second phase will end by 30th September 202.
Samuel Ogbodu, managing director of the Company in a statement made available to journalists said this is coming following the company’s application to the Exchange for share capital reconstruction.
He stated that this is also in line with the special resolutions passed by the shareholders at the Extra-ordinary General Meeting (EGM) held in March 2020 in favour of the Company’s proposal to carry out a share capital reconstruction of the company through its stockbroker, FSDH Securities Limited, which submitted an application for the share capital reconstruction to the Nigerian Stock Exchange.
Read also: Universal Insurance strengthen products to deepen penetration
Ogbodu further stated that the share capital reconstruction was adopted as the more efficient approach to create room for new equity capital issuances.
According to him, the suspension of the company share became necessary to allow for closure of the company’s register of members in order to determine shareholders eligible for the share capital reconstruction as at the qualification date of 16 October 2020.
He added that the period of the suspension is from 19 October 2020 to 30 October 2020.
“Sunu Assurances is undertaking share capital reconstruction, which will see cancellation of 11.2 billion ordinary shares of 50 kobo each, 80 per cent of the company’s current issued share capital. We plan to cancel 11.2 billion ordinary shares of 50 kobo each out of its existing issued 14 billion ordinary shares of 50 kobo each as part of a recapitalisation plan aimed at increasing the capital base of the insurance company to the new minimum capital base, he said.
“The shortfall between our paid-up capital and NAICOM’S new capital requirement of N10 billion for non-life insurance companies was N7.71 billion as at September 30, 2019. The purpose of the share capital reduction was to allow for the issuance of new ordinary shares by way of a rights issue and private placement, in order for the company to comply with the recently revised share capital requirement by the National Insurance Commission (NAICOM) for insurance companies.
