Recapitalisation: LASACO Insurance gets investors nod to raise N10bn additional capital
LASACO Assurance Plc has gotten its shareholders’ approval to raise N10 billion additional capital through special/private placement.
The shareholders gave the approval on Tuesday at the firm’s Annual General Meeting (AGM) in Lagos. With the approval, the firm hopes to raise additional capital through the issuance of up to 9,250,000,000 ordinary shares of N0.50k each at N1.20k per share by way of special/private placement.
They also gave the company the permission to reconstruct its existing ordinary shares of 7,334,344 on the basis of one new share for every four shares previously held.
Other approval granted by the shareholders were that the sum of N2, 749,279,000 representing the surplus the nominal value of the reconstructed shares be transferred into the share reserve account and form part of the shareholders’ funds of the company and that the reconstructed 1,833,586,000 ordinary shares of 50k each, revalue in accordance with the ratio of reconstruction, subject to appropriate regulatory consent and be listed on the Nigerian Stock Exchange (NSE).
The shareholders also gave a nod to payment of 5k dividend by the firm. The shareholders applauded the company for being able to pay a dividend at a time many of its contemporaries could not do so due to low profitability.
Chairman of the company, Mrs Aderinola Disu, while speaking on the financial performance of the firm, posited that the firm grew its gross premium income by 35 per cent from N6.6 billion achieved in 2017 to N9.0 billion in 2018.
She noted that the net underwriting income also increased by 25 per cent, moving from N3.67 billion in 2017 to N4.59 in 2018, while the net claims expenses decreased by 5 per cent from N1.9 billion incurred in 2017 to N958 million in 2018 and the shareholders’ fund increased by two per cent, from N8.15 billion in 2017 to N8.48 billion in 2019.
She maintained that the firm will continue to concentrate on the approaches that have given it utmost dividend and remain committed to continued delivery of excellent services to its customers.
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The Managing Director/Chief Executive Officer, Segun Balogun, expressed optimism that the firm would scale the recapitalisation hurdles. He noted that as a composite company, the board and management has set in motion all necessary machinery to ensure the firm meets the N18 billion minimum capital requirements.
He noted that the firm would continue to work hard to surpass its last year financials, stressing that the future of the firm remains very bright.
The Chairman Emeritus, Independent Shareholders Association of Nigeria(ISAN), Sir Sunny Nwosu and the President, Progressive Shareholders Association of Nigeria(PSAN), Mr Boniface Okezie, who spoke on behalf of shareholders at LASACO Assurance AGM, said,
they gave the approval to the board of the company to raise additional capital and restructure its shareholding so that the insurer can still continue to underwrite risk business beyond the June 2020 recapitalisation deadline of which they expect the company to have fully recapitalised by then.
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They agreed that insurance business is tough in Nigeria and could account for why a lot of underwriting firms are currently struggling to survive, saying,
they believe in the current management of the assurance firm to continue to improve on its financial track record, having declared 5 kobo dividend to its shareholders in its 2018 financial year-end.
