Increase Your Stake for Improved Returns, CHI MD Tells Shareholders
The Managing Director/Chief Executive Officer of Consolidated Hallmark Insurance (CHI ) Plc, Mr. Eddie Efekoha, has said the ongoing rights issue of the insurance firm is an opportunity to increase their stake ahead of expected improved return on investments.
The general insurance and special risks underwriter is offering 2,032,500,900 shares of 50 kobo each at 52 kobo per share through a rights issue to existing shareholders. The offer opened on Monday, February 24, 2020 and is expected to close on April 1, 2020.
Speaking at a media parley in Lagos, Efekoha said the proceeds of the issue would be used to beef up the company’s capital, assuring that CHI Plc would meet the N10 billion new capital base for general insurance business by June 2020.
According to him, the company would stick to the old timeline of June deadline not the current deadline of December.
Efekoha said that the proceeds of the rights issue would be applied towards investment in the company’s subsidiary such as Grand Treasurers Limited, expansion of the retail business platform and working capital enhancement.
“Whilst CHI has continued to perform well on several parameters, the essence of this capital raising exercise is to further enhance its capital in order to meet the revised minimum statutory capital of N10 billion stipulated by the National Insurance Commission as being the statutory requirement for the operation of a non-life (general) insurance business,” he said.
Efekoha assured shareholders of enhanced returns post recpaitalisation era, noting that the company had paid dividends consistently since 2008.
He also expressed optimism that the rights issue would be fully subscribed because of shareholders confidence in the company and its growth potential.
Efekoha disclosed that the company was rapidly expanding its operations into other financial service business with various subsidiaries.
“The latest subsidiary that has been added to the stable is the CHI Microinsurance Limited, a micro life assurance company recently granted approval in principle by NAICOM and set to commence operations by the second quarter of this year,” he said.
According to him, CHI Plc had embarked on a five-year corporate strategic plan in 2016.
“This encompasses various initiatives which include: deepening its existing market share and business diversification into Health Management Organisation, Life Assurance company and other allied financial services business with a view to achieving enhanced shareholders value,” he said.