• Friday, March 29, 2024
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AIICO Insurance increases authorized share capital to N18bn

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In line with the preparations to meet the new minimum capital requirement for the insurance industry, AIICO Insurance Plc has received shareholders’ approval to increase its authorized share capital from N10 billion to N18 billion.

At the Extra- Ordinary General Meeting (“EGM”) in Lagos, the shareholders demonstrated their support by voting in favour of the recapitalisation. This is coming at a time public quoted insurance companies are struggling to convince their minority shareholders to align with their recapitalisation plans.

A few meetings of the insurance companies with their shareholders have seen board chairmen and directors sweating hard to convince the minority shareholders to approve their different capital raising proposals.

“These are exciting times for us as a business,” said Babatunde Fajemirokun, managing director. “We are confident that the recapitalization exercise will see the company emerge stronger, more resilient, with adequate capacity and competencies to continue to provide risk protection and value adding services to all our customers and stakeholders.”

Kundan Sainani, chairman of the Board, at the EGM stated that AIICO has received NAICOM’S ‘ No Objection’ to its recapitalization plan. The company’s recapitalization plan includes a combination of private placement, rights issue and bonus issue.

Ac c o rd i n g to Fa – jemirokun, the private placement is at an advanced stage with a number of investors. Therefore, the shareholders also approved amendments to the Memorandum of Association to reflect the addition of new investors.

The Nigerian insurance industry is estimated to see some N200 billion after the ongoing recapitalisation by underwriters, making for a stronger sector that can offer good returns to investors and contribute reasonably to the economy.

Industry experts believe that the sector post consolidation will have enough resources to attract quality manpower, acquire necessary skills to underwrite big ticket risks, increase retention in the local market, and be able to take advantage of untapped potentials to create shareholder value.

The National Insurance Commission ( NAICOM) had in a circular issued on Monday May 20, 2019 announced increase in the paid-up share capital of life companies from N2 billion to N8 billion; General Business from N3 billion to N10 billion; Composite Business from N5 billion to N18 billion; and Reinsurance companies from N10 billion to N20 billion, with 30th June 2020 as deadline.

AIICO Insurance Plc., a leading composite insurer in Nigeria, commenced operations in 1963. AIICO provides life insurance, health insurance, general insurance, wealth management and pension management services as a means to create and protect wealth for individuals, families and corporate customers.