Consolidated Hallmark Insurance Plc (CHI) has applied to raise about N1.057 billion from shareholders via a rights issue, as part of its recapitalisation exercise.
In a notification to the Nigerian Stock Exchange (NSE), through its stockbrokers, CHI applied to make a rights issue of 2.033 billion ordinary shares of N0.50 each at N0.52 per share on the basis of one new share for every four ordinary shares held.
Shareholders of the insurance company had last November approved the raising of additional funds to boost its operations, play a leading role in the industry and deliver superior returns on investments.
At an extra-ordinary general meeting (EGM), the shareholders authorised the directors to raise, whether by way of private/public, special offering, rights issue or a combination or any other method(s) they deem fit, additional capital of up to N4.5 billion or its equivalent whether locally or internationally or a combination of both, through the issuance of shares, long term debt, preference shares (redeemable or irredeemable), convertible and non convertible securities or depository receipts or any other instrument(s), whether as a standalone transaction, or a combination.
The Chairman of CHI Plc, Mr. Obinna Ekezie, told the shareholders that with their approval and continued support, the company would emerge a stronger and more formidable player in the sector, adequately equipped to meet the growing needs of its rapidly expanding clientele and with the ability to retain a higher proportion of risks hitherto ceded.
According to him, the operations of CHI Plc had since been enhanced with the earlier capital raise in 2017/2018, noting that the nine months ended September 30, 2019 attested to that.
“Although the anticipated business climate is yet to be attained, additional resources deployed in operations have led to the latest results. Profit after tax (PAT) of N519.6 million was recorded during the third quarter as against the N355.9 million recorded in the corresponding period of 2018, representing a 46 per cent rise. The result also revealed significant improvements in other indices. Gross premium written for the period grew by 23.7 per cent to N6.687 billion from N5.404 billion reported in September 2018. Also, total assets of the group rose to N11.159 billion from N10.821 billion during the corresponding period. There are strong indications that this trend would not only be sustained, but possibly surpassed as the financial year draws to a close,” Ekezie said.
The chairman disclosed that the company was on the verge of being granted an operational licence by the National Insurance Commission(NAICOM) to operate a Micro-Life Insurance subsidiary.