Law Union & Rock Insurance to be delisted from NSE
15 October 2020 |
3:00 am
Law Union & Rock (LUR) Insurance will soon join the league of delisted firms, as the Nigerian Stock Exchange (NSE), has approved its application seeking voluntary delisting of its shares
Managing Director, Law Union & Rock Insurance Plc, Ademayowa Adeduro
• As Exchange approves share sale to Anglophone firm
Law Union & Rock (LUR) Insurance will soon join the league of delisted firms, as the Nigerian Stock Exchange (NSE), has approved its application seeking voluntary delisting of its shares from the main board of the Exchange.
The voluntary delisting is part of the ongoing acquisition of LUR by Anglophone West Africa private equity firm, Verod Capital Management.
Verod has offered N5.3 billion for the acquisition of the entire share capital of LUR in a major bid that may signal the opening up of mergers and acquisitions in the Nigerian insurance industry, an option many of the underwriters may embrace to meet new capital requirement stipulated by the National Insurance Commission (NAICOM).
The board of Law Union confirmed that it received a binding offer from Verod Capital seeking to acquire the entire 4.296 billion ordinary shares of 50 kobo each at N1.23 per share, valued at N5.28 billion.
The offer price of N1.23 per share represented a premium of 208 per cent on the 60-day volume-weighted average share price, and 140 per cent on Law Union’s closing share price on February 26, 2020.
At the Annual General Meeting (AGM), and the Court-Ordered Meeting (COM), last month, in Lagos, the shareholders said they are willing to collect the N1.23 per share being offered by Verod Capital.
The new owners have proposed to purchase the entire issued share capital of the firm in a Transaction Implementation Agreement (TIA) through its investment vehicle, Kanuri LUR Limited.
On the payment of the amount requested by shareholders, Law Union and Rock Insurance will be delisted from the main board of the NSE, while the registration of its ordinary shares with the Securities and Exchange Commission (SEC), will be withdrawn and the firm will be re-registered as a private company limited by shares.
NAICOM asked all insurance and reinsurance companies to increase their minimum paid-up capital, and LUR’s currently stands at N3 billion. But with this Verod Capital deal, it will rise to N10 billion, enabling it to remain in business.
According to Chairman of the firm, Remi Babalola, this decision was taken to give better value to shareholders’ investments, while the Managing Director, Ademayowa Adeduro, said the board and management took the best decision in the interest of shareholders.
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