Prestige Assurance Plc has announced application list for a N6.82 billion rights issue, enabling shareholders to pick up their new pre-allotted shares in the insurance company.
The insurance firm is offering 13.636 billion ordinary shares of 50 kobo each to shareholders at a par value of 50 kobo. The rights have been pre-allotted on the basis of 38 new ordinary shares for every 15 held as of January 31, 2020.
Application list for the rights issue opened on Monday and will close on Thursday, September 17.
According to the note issued by the company and published on the Nigerian Stock Exchange (NSE), the management of Prestige Assurance stated:
“Further to our Market Bulletin of 17 March 2020, with reference number: NSE/RD/LRD/MB21/20/03/17, Dealing Members are hereby notified that Prestige Assurance Plc’s Rights Issue of Thirteen Billion, Six Hundred and Thirty-Five Million, Seven Hundred and Ninety-Six Thousand, and Six (13,635,796,006) ordinary shares of 50 Kobo each at 50 Kobo per share on the basis of Thirty-eight (38) new ordinary shares for every Fifteen (15) ordinary shares held as at 31 January 2020, has opened for subscription,”
The New India Assurance Company Limited, Mumbai, the precursor and founder of Prestige Assurance, holds 69.50 per cent majority equity stake in the Nigerian subsidiary while Leadway Assurance Company, an unlisted Nigerian insurance company, holds 11.47 per cent equity stake.
Shareholders of Prestige Assurance had created additional new 14 billion ordinary shares to create headroom for the new capital raising. It increased its authorised share capital from N3 billion of six billion ordinary shares of 50 kobo each to N10 billion of 20 billion ordinary shares of 50 kobo each through the creation of more 14 billion ordinary shares of 50 kobo each.
Shareholders also authorised the Board of Directors of the company to raise “capital by way most suitable to the company in line with the recapitalisation requirement of the National Insurance Commission”.
The National Insurance Commission (NAICOM) had in May 2019 released new capital requirements for insurance businesses, mandating operators to shore up their minimum capital base to the required level.
The minimum paid-up share capital of a life insurance company was increased from N2 billion to N8 billion, non-life insurance from N3 billion to N10 billion, composite insurance from N5 billion to N18 billion while re-insurance companies were directed to raise their capital base from N10 billion to N20 billion.