Consolidated Hallmark Insurance Plc (CHI) has announced plans for a private placement that will see the injection of fresh capital into the company and bring in new investors.
In its bid to achieve this, the company would be having its Extra-Ordinary General Meeting (EGM) on November 28, in Lagos, to get the approval of its shareholders and give their authorisation to the directors.
The directors are requesting that the authorised share capital of CHI Plc be increased from N5 billion divided into 10 billion ordinary shares of 50 kobo each to N7.5 billion ordinary shares divided into 15 billion ordinary shares with the creation of additional five billion ordinary shares of 50 kobo each.
The directors are also seeking the authorisation of shareholders to allot 1.130 billion units of ordinary shares of 50 kobo each at 65 kobo per share through a private placement.
Why this move by Consolidated Hallmark Insurance
The private placement is being undertaken by CHI Plc to meet the new capital requirements stipulated by the National Insurance Commission (NICOM).
Recall that the company had last year raised additional funds through a rights issue and the company has been recording impressive performance in recent times. Proceeds from the issue were used to acquire a life insurance firm and set up a Health Maintenance Organization (HMO), Hallmark HMO.
It ended the nine months to September 30, 2018, with a growth of 70 per cent in profit after tax (PAT). The company recorded PAT of N356 million in 2018, up from N209 million in the corresponding period of 2017.
Consolidated Hallmark Insurance was incorporated on the 2nd of August 1991 as a private limited liability and began operations in 1992. It was converted to a public limited liability company in July 2005, and the name changed from Consolidated Risk Insurers to Consolidated Hallmark Insurance. The firm was listed on the Nigerian Stock Exchange (NSE) on the 22nd of February 1998. Its share is currently trading at N0.30 on the floor of the Nigerian Stock Exchange with a one-year return down by 36.13%.
