AIICO Insurance Plc has received an investment of ₦5.38 billion from Leap Frog and AIICO Bahamas. The amount was classified under deposit for shares in the company’s 2019 interim annual report published on the website of the Nigerian Stock Exchange.
Deposit for shares represents amounts received by the company from its recent private placement, in which Leap Frog Investment Limited and AIICO Bahamas Limited invested a combined amount of ₦5.38 billion into the company on 12 December 2019.
Amount received is kept in a dedicated account with the issuing house, Stanbic Capital pending the receipt of the final approval by the Securities and Exchange Commission (SEC).
No official announcement or press release was issued by AIICO on the website of the Nigerian Stock Exchange as that is typically the case. The NSE rule mandates listed companies to disclose such transactions via a press release on the website of the Nigerian Stock Exchange.
In 2019, Nairametrics reported that AIICO was considering a ₦5.28 billion investment. The company reported same on the Nigerian Stock Exchange. It reported it planned to raise 4.4 billion ordinary shares of ₦0.50 each at ₦1.20 per share by way of a special/private placement. Shareholders had in May 2016, given the directors’ approval to raise additional capital up to ₦25 billion.
In June 2018, LeapFrog Investments, an emerging market (EM) focused private equity fund, took up a stake in ARM Pension managers. LeapFrog Investments recently announced it now has about $700 million in the “largest-ever private equity fund by a dedicated impact fund manager” with the funds targeted at emerging market countries including Nigeria. The fund will be targeted at insurers, pensions and asset managers, development finance institutions, foundations and family offices.
The National Insurance Commission (NAICOM), the nation’s regulatory body for insurance firms in the country, last month, released the new capitalization requirements for insurance firms in the country.
Under the risk based capitalisation requirements, each cadre namely life, non life and composite insurance firms have had their capital base divided into three tiers.
Insurance companies operating in the composite segment, that is all classes of insurance now have three tiers. Companies operating in tier one will be required to have a capital base of N15 billion. Tier two firms will need to have a capital base of N7.5 billion, while those in tier 3 will maintain the current capital base of N5 billion.
AIICO also announced plans to raise another N3.5 billion in rights issue and will seek shareholder approval at an EGM slated for March 2020.