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Chuks Udo Okonta
Foremost Insurance company, Consolidated Hallmark Insurance (CHI Plc), has received the approval of Regulators to raise an additional sum of N1,056,900,000 to further beef up its capital base.
The Securities and Exchange Commission (SEC) gave the approval to the General Insurance and Special Risks underwriter to offer a total of 2,032,500,900 units of 50 kobo each at 52 Kobo per share through a Rights Issue to existing shareholders. The offer opened on Monday, 24th February, 2020 and is to run for a period of five weeks, with closing date of 1st April, 2020.
Shareholders of the company who were listed on the register of members as at close of business on 3rd February, 2020 qualify to take advantage of the offer on the basis of one new share for every existing four units currently being held.
The Rights Issue is one of the series of steps approved by Shareholders of the Company at an Extra-Ordinary General Meeting in November, 2019 where the Directors were unanimously given the mandate to embark on various measures to meet the new N10bn required minimum capital base of operators in the general business and special risks category.
Consolidated Hallmark has had very successful outings in its recent capital raising efforts due to a firm belief by shareholders in the intrinsic value of the company. The company in the last two years, in consideration of the need for higher working capital and risk retention capacity, had proactively embarked on fund raising through a Rights Issue and Private Placement, both of which were fully subscribed.
The lead issuing house to this offer is Planet Capital Limited, supported by SFS Financial Services Limited and IWorld Financial Services Limited as joint Issuing Houses, while Meristem Registrars acts as the Registrar to the offer.
The Chairman of the company, Obinna Ekezie, sees the recapitalization program as a welcome development that will lead to a more virile insurance sector with improved performance and also ensure that the company captures a larger market share and give better returns to all stakeholders.
The Managing Director/CEO of Consolidated Hallmark who is the current President of the Chartered Insurance Institute of Nigeria (CIIN), Eddie Efekoha, is optimistic of a very successful outing based on the keen enthusiasm from shareholders.
According to him, “we are very confident of having a successful outing because our shareholders believe in us. We have shown commitment to shareholder value creation and paid dividend time and again.” He recalled that the company is one of the most consistent dividend-paying publicly quoted firms amongst listed companies generally, and particularly in the insurance sector. He enjoined the shareholders to exercise their rights in full.
Efekoha also said that the company is rapidly expanding its operations into other financial services business with various subsidiaries that are contributing to revenue. The latest subsidiary that has been added to the stable is the CHI Microinsurance Limited, a Micro Life Assurance company recently granted approval in principle by NAICOM and set to commence operations by the second quarter of this year.