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FCMB Pensions is planning to acquire AIICO Pension Managers Ltd

Recently, AIICO Insurance has been raising capital through various means. The sell-off could be one of them.

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FCMB Pensions Ltd, a subsidiary of FCMB Group Plc, has commenced acquisition talks with the shareholders of AIICO Pension Managers Ltd.

The company wants to acquire 70% stakes in AIICO Pension Managers Ltd which is currently held by AIICO Insurance Plc, the parent company. An additional 26% stake in AIICO Pension (which is held by other shareholders) would also be acquired by FCMB Pensions Ltd, thereby bringing the proposed acquisition to 96% stake.

Separate statements made available to the Nigerian Stock Exchange by both FCMB Group Plc and AIICO Insurance Plc confirmed this development. But neither statement gave any reason for the proposed sale/acquisition.

FCMB Group did, however, explain that the proposed transaction is still subject to regulatory approvals, particularly approvals from the Federal Competition and Consumer Protection Commission as well as the National Pension Commission.

“FCMB Group Plc (FCMB Group) hereby notifies the Nigerian Stock Exchange (“NSE”) and the investing public that its pension management subsidiary, FCMB Pensions Limited (“FCMB Pensions”) has entered into discussions with shareholders of AIICO Pension Managers Limited (“AIICO Pensions”), to acquire the 70% stake held by AIICO Insurance Plc and 26% held by some other shareholders in AIICO Pensions. The proposed acquisition will make AIICO Pensions an indirect subsidiary of FCMB Group Plc,” FCMB Group said in its statement to the NSE.

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READ MORE: DMO appoints new Government Stockbroker 

Meanwhile, part of the statement by AIICO Insurance Plc said:

“AIICO Insurance Plc (AIICO) hereby notifies the Nigerian Stock Exchange (“NSE”) that AIICO has entered into discussions with FCMB Pensions Limited (“FCMB Pensions”), for the sale of 70% stake in its Pension Management subsidiary, AIICO Pensions Managers Limited (“AIICO Pensions”) to FCMB Pensions Limited.

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“The proposed sale is AIICO’s stake of 70% and other shareholders stakes of 26% thus bringing the cumulative sale of 96% stake to be purchased by FCMB Pensions. At the conclusion of the proposed sale, AIICO Pensions shall cease to be a subsidiary of AIICO Insurance Plc.”

READ ALSO: FCMB holds virtual AGM as shareholders commend performance, prove Dividend

Recall that AIICO Insurance Plc has recently been raising capital through various means, mainly in a bid to meet the new recapitalisation requirement that was set by the National Insurance Commission, NAICOM. Two weeks ago, the company announced that it had sought the approval of the Nigerian Stock Exchange to list some 4.3 billion ordinary shares of N0.50 each. Perhaps, selling its subsidiary is part of the AIICO’s capital raise options.

In Q1 2020, AIICO Insurance grew its gross premium by 22.5% to N17.6 billion from N14.3 billion in Q1 2020. Profit after tax also grew by 82.8% to N1.9 billion during the quarter under review.

AIICO Insurance stock opened today’s trading on the Nigerian Stock Exchange at N0.97. Year to date, the share price has gained about 46%, up from N0.60 recorded in January this year.

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Emmanuel is a professional writer and business journalist, with interests covering Banking & Finance, Mergers and Acquisitions, Corporate Profiles, Brand Communication, Fintech, and MSMEs. He initially joined Nairametrics as an all-round Business Analyst, but later began focusing on and covering the financial services sector. He has also held various leadership roles, including Senior Editor, QAQC Lead, and Deputy Managing Editor. Emmanuel holds an M.Sc in International Relations from the University of Ibadan, graduating with Distinction. He also graduated with a Second Class Honours (Upper Division) from the Department of Philosophy & Logic, University of Ibadan. If you have a scoop for him, you may contact him via his email- [email protected] You may also contact him through various social media platforms, preferably LinkedIn and Twitter.

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Corporate deals

Continental Reinsurance Plc acquires 100% ownership of its Botswana subsidiary

Continental Reinsurance Plc now holds 100% of issued ordinary share capital in its subsidiary.

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Continental Reinsurance Plc has announced 100% ownership of its Botswana subsidiary, as it posts strong growth in its H1 2020 results.

In a bid to continue in its quest for geographical diversity, Continental Reinsurance Plc announced, that it has acquired a minority 40% stake in its Botswana subsidiary, known as Continental Reinsurance Ltd (Botswana), through its holding company – CRe African Investments Limited (“CRAFIL”).

This is contained in a press release released September, 10 and signed by the firm’s Group Communications Manager, Elsie Mbera.

The acquisition means, Continental Reinsurance Plc now holds 100% of the issued ordinary share capital in the subsidiary, effectively announcing a change in the ownership structure of Continental Reinsurance Ltd (Botswana).

On the rationale behind the deal, the Group Managing Director, Dr Femi Oyetunji, was quoted saying: “The acquisition means not only growth in economic size, but also presents us with an opportunity to enhance our strategic influence, and broaden our market appeal through the expansion of stakeholder segments that we actively interact with.”

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On who will lead its newly acquired Botswana subsidiary, Dr Femi added that, “Building on our talent growth and diversity strategy, we have appointed Mr Francis Nzwili as Managing Director. Previously with our Nairobi subsidiary, as Managing Director of the Botswana business, Francis comes on board with a wealth of experience in underwriting and business development, that significantly complements the strength of the existing team. The position of Managing Director was previously held by Mr Cas Hansa, who has taken up new strategic responsibilities as Group Head: Underwriting and Claims.”

Continental Reinsurance, established in 1985, is a composite private pan-African reinsurer that has been on the continent for more than 30 years, writing business in more than 50 countries across the African continent. It provides support to over 200 insurance companies in Africa, with its main offices in Nigeria, Cameroon, Kenya, Côte d’Ivoire, Tunisia and Botswana.

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Corporate deals

Digital Currency Group acquires crypto exchange, Luno

DCG’s recent acquisition will be of significant financial commitment to support Luno expand worldwide.

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One of the leading blockchain companies, Digital Currency Group, or DCG, has recently acquired the British based crypto exchange, Luno.

DCG had initially bought a stake in Luno by investing in the exchange’s seed round in 2014. Since then, the exchange has spread its roots across 40 countries and currently boasts of more than five million registered users on its platform.

American based DCG will be making a significant financial commitment to support Luno expand worldwide including where Luno currently operates and beyond. Financial terms of the deal were however not disclosed.

DCG Founder and CEO Barry Silbert spoke on the recent deal. He said, “We are proud to have supported Luno as an early investor, and we recognize a shared commitment to building mission-driven companies that can help transform traditional financial services and improve economic freedom for people all over the world.”

“Luno is a high growth, global business and there is a massive opportunity to expand organically and through acquisitions,” he added.

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DCG stated that Luno will keep operating as an independent organization under the leadership of its CEO while DCG will provide leadership, partnership, and investment capital to help the exchange scale its business.

Luno has become a digital asset powerhouse in many emerging and frontier markets, providing digital asset education, knowledge, and investment tools for individuals in Africa, Asia, and Europe.

Luno has helped broaden the global crypto investment community and the company has seen record growth of its customer base in 2020.

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In Africa, the company saw more than 550,000 new users on its platform in Q2 2020 and contributes the largest share of cryptocurrency trading volume on the continent across non-P2P exchanges.

Luno is a leading exchange in several countries that have the highest percentage of cryptocurrency ownership, including South Africa (third-highest of its citizens owning digital currencies), Nigeria (fifth-highest), Indonesia (sixth-highest), and Malaysia (tenth-highest)

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Corporate deals

Access Bank acquires Zambian Cavmont Bank Ltd

The statement from Access Bank says that the deal is a highly complementary transaction.

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Access Bank Zambia, a subsidiary of Nigeria’s Access Bank Plc, has reached a ‘definitive agreement’ with Cavmont Capital Holdings Zambia Plc (CCHZ) to acquire Cavmont Bank Ltd.

The tier-1 bank announced this latest development regarding the merger talk which has been ongoing for a while, in a statement that was signed by its Company Secretary (Sunday Ekwochi) and issued to the Nigerian Stock Exchange earlier today.

According to the statement by Access Bank, the deal is a highly complementary transaction that is expected to combine Access Bank Zambia’s wholesale and trade finance capabilities with Cavmont Bank’s retail and commercial banking operations.

READ ALSO: CBN debits banks N216.1 billion for CRR compliance

The proposed transaction which, in the meantime is still subject to relevant shareholder and regulatory approvals, is also expected to better position Access Bank Zambia as one of the top 10 banks in the Southern African country.

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Customers from the enlarged bank will benefit from greater security offered by what will be one of the most capitalized banks in Zambia with a more diversified product and service offering and a broader geographical footprint and infrastructure.

Access Bank on its notification stated, ‘’Subsequent to our announcement on July 8, 2020, the Board of Access Bank Plc announces today that its subsidiary, Access Bank (Zambia) Limited, has entered into a definitive agreement with Cavmont Capital Holdings Zambia Plc (CCHZ) regarding proposed acquisition of Cavmont Bank Limited, a subsidiary of CCHZ and subsequent merger of Cavmont Bank’s operations into Access Bank Zambia. The proposed transaction, which remains subject to relevant shareholder and regulatory approvals, will position the enlarged Access Bank Zambia as one of the top 10 banks in Zambia and create the momentum to advance its strategic objectives.’’

READ: A look at how much banks paid their workers in Q1 2020

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‘’Under the terms of the agreement, Access Bank Zambia will acquire the entire issued ordinary share capital, assets and liabilities of Cavmont Bank while Capricom Group Limited, the ultimate majority shareholder of CCHZ will invest at least ZMW300 million ($16.5 million) of preference shares into Access Bank Zambia. Capricorn will hold preference shares in the enlarged Access Bank Zambia for a period of five years, after which the preference shares will be acquired by Access Bank Plc.’’

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The statement also notes that the enlarged bank will be well placed to participate in the long-term economic growth of Zambia and will be predicated on the country’s vast reserves of natural resources and fast growing young population.

The transaction is expected to be completed during the fourth quarter of 2020.

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