Universal begins recapitalisation process
With the approval obtained by the board and management of Universal Insurance Plc, it has got shareholders approval to raise capital through Right Issues, Share Reconstruction, additional equity capital to the maximum limit of the authorised share capital to meet the N10 billion recapitalisation requirement.
This will be done whether by way of special placement or public officer with or without a preferential allotment/or rights issue or a combination of any of them, either locally or internationally and upon such terms and conditions as the directors may deem fit in the interest of the company and subject to the approval of the regulatory authorities.
In a statement, the Acting Board Chairman of the company, Mr Anthony Okocha, said the board had sought and obtained the shareholders’ approval at its 49th Annual General Meeting (AGM)s in Lagos.
He said: “The company is set to deploy in motion, strategies that would see it raise the N10billion recapitalisation requirement as prescribed by the National Insurance Commission (NAICOM) for the general business category, in the ongoing recapitalisation exercise,.
‘’In the event of over subscription of the offer/issue to capitalise, the excess money and allot additional shares to the extent that can be accommodated by the company’s unissued share capital subject to the approval of the regulatory authorities and that the proceeds should be used for the same purpose as the offer/issue.
“Universal Insurance has over N30 billion registered shares and out of which,16 billion has been issued while 14 billion is still warehoused and could be brought up for issuance if need be. The company has in its kitty, N6.5 billion and would need N3.5 billion to make up for recapitalisation requirement as a general business insurer,” he said.
On steps to meet up with the exercise and beat the June 30 2020 deadline, Okocha said: “More discussion is ongoing but could not be discussed prematurely. We are also looking at Right Issues, the company is in discussion with core investors and probable foreign influence into your company.”
On financials, he said notwithstanding the shape and colour of the global economy in 2018 and its effect on the macroeconomic landscape in Nigeria, the company recorded about 45per cent increase in gross written premium (GWP) from N753million in 2017 to N1.689billion in 2018. Claims expense decreased from N463million in 2017 to N263million in 2018.
However our underwriting expense rose from N166million in 2017 to N452million in 2018, he added.
Okocha said it is the intention of the board and management to intensify the corporate strategy in order “to identify the needs of potential customers, their behaviour and culture and have an attentive ear to market-feedback so to create products that will address them.