Mutual Benefits Assurance Shops for N2bn via Rights Issue

Mutual Benefits Assurance Plc has commenced shopping for N2 billion through a Rights Issue of 4.0 billion shares of 50 kobo each to existing shareholders at 50 kobo per share. The rights issue has been provisionally allotted on the basis of one new ordinary share of 50 kobo each for every two ordinary shares held as at the close of business on November 1, 2017.

Application list for the rights issue formally opened last Monday and will close on Friday, September 14, 2018. Both the Securities and Exchange Commission (SEC) and Nigerian Stock Exchange (NSE) had earlier approved the supplementary offer.

Shareholders of the insurance company had at an Extraordinary General Meeting in Ibadan, Oyo State on June 27, 2018 approved the recapitalisation plan.

Also, the shareholders had expressed their support to the capital raise of the N2 billion rights issue intended to increase the company’s shareholders’ funds -strengthen its capital base, deepen capacity to underwrite risks, upgrade its information technology and enhance its working capital.

Speaking at the 22nd annual general meeting (AGM) recently the Chairman of the company, Akin Ogunbiyi, reassured the shareholders of the company’s commitment to a sustainable growth in line with its five -year strategic plan.

According to him, the 2017 financial year revealed a 15.6 per cent growth in gross premium to N14.04 billion from N12.14 billion in 2016, which puts the company among the league of top Nigerian insurance companies.

“Net benefits and claims grew by 53.9 per cent from 2016’s figures. The significant growth in gross premium and better management of resources made 2017 a turnaround year for the company. Both shareholders’ funds and policyholders’ funds are represented by the right portfolio mix of short and long-term investments,” he said.

Mutual Benefits Assurance had in 2017 started implementation of a five-year strategic plan aimed at repositioning it for future opportunities and challenges.

The five-year plan focused on four key areas of the group’s business including deepening market penetration and customer acquisition, customer service delivery excellence, transformation of it people and culture and operational effectiveness.

Ogunbiyi said the net proceeds of the rights issue would be used to finance the company’s growth plan including provision of additional working capital and expansion of information and communication technologies to support the company enlarged operations.

He said the strategic goal of the company is to become the number one insurance company in Nigeria in terms of growth and profitability.

He assured new investments in technologies would help the company to eliminate delay in its processing and focus more on customer satisfaction.