Consolidated Hallmark Insurance hints N4bn capital raise to meet recapitalisation requirements
Adesola Afolabi was a businessamlive reporter and Head of Financial desk.
Eddie Efekoha, chief executive officer Consolidated Hallmark Insurance Plc., has disclosed that the company will visit the market towards raising N4 billion to meet its capital requirements.
In his address to brokers at the 2019 August members evening held Tuesday in Lagos, Efekoha said the recapitalisation directive from the NAICOM requires that the company has a capital of N10 billion in order to keep its existing license.
As at date the company’s shareholder funds stands at N6 billion, Efokoha said, leaving about N4 billion to be sourced.
Coincidentally, he said the company had in a bid to shore up its capital base, engaged in capital raising activities that has already brought in N1.2 billion.
He said the company carried out a rights issue where N500 million was raised from existing shareholders. Another successful private placement raising N700 million through new shareholders was recently concluded, he said.
“This shows we have adequate experience and capacity to raising the capital required.”
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The insurance firm boss also hinted that the company is not averse to mergers and acquisition provided that the benefits from such acquisition align with the company’s corporate goals.
He said the company’s consideration of a merger is not necessarily because the required N10 billion can’t be raised, but because some organic and inorganic benefits can be accrued to the firm through the process.
Agusto & Co recently rated the firm BBB, Efekoha said the rating indicates a stable outlook for the firm.
Mary Adeyanju, CHI plc’s executive director operations affirmed the company’s strengthened position among industry players.
According to her, the company has consistently paid dividend to shareholders amounting to N1.38 billion while claims paid in the last five years amounted to N11 billion.
Insurance brokers unanimously gave credence to the outstanding performance of the insurance company. The brokers noted that the underwriter was great to work with. In terms of claim payments and overall service, the company is excellent, one broker told business a.m’s correspondent.