African Alliance Insurance wants to raise more capital and boost its recapitalisation plan with divestment. The company’s board has planned the divestment and will inform shareholders at the company’s annual general meeting later this month.
According to the proposal, shareholders will be asked to approve three resolutions authorising the “directors to divest from any existing investment assets in furtherance of the recapitalisation objectives of the company”.
Shareholders will be asked to also authorise the directors to appoint such advisers, professionals and parties that they deem necessary upon such terms and conditions that the directors may deem appropriate with regard to the divestment.
The meeting is also expected to mandate the board to take all steps and do all acts that they deem necessary for the successful implementation of the divestment.
Insurance companies are rasing new equity capital to meet new minimum capital requirements for various insurance functions as directed by the National Insurance Commission (NAICOM). In May 2019, NAICOM released new capital requirements for insurance businesses with a 13-month compliance period for operators to increase their minimum capital base to the required level. The minimum paid-up share capital of a life insurance company was increased from N2 billion to N8 billion, non-life insurance from N3 billion to N10 billion, composite insurance from N5 billion to N18 billion while re-insurance companies were directed to raise their capital base from N10 billion to N20 billion.
Shareholders of African Alliance had at the last annual general meeting thrown their weight behind the board and management of the company in their ongoing quest to reposition the firm and fully recapitalise it before the deadline set by the NAICOM.
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