January 14, 2019

VFD Group pulls out N1.6bn shareholding from NEM Insurance

VFD Group pulls out N1.6bn shareholding from NEM Insurance

File: insurance

Raises N2.7bn from IPO, rights offer

By Babajide Komolafe

THE VFD Group said it has divested its N1.6 billion shareholding from NEM Insurance following disagreement with the management over strategic direction of the company.

Meanwhile, the Group has successfully raised N2.78 billion from rights issuance and private placements against the original N2billion target.


VFD Group is a financial services focused proprietary investment company with subsidiaries providing Financial Advisory, Asset Management, Bureaux De Change, Real Estate, Debt Services and Private Funds Management Services.

In statement announcing its divestment from NEM Insurance, the group said: “Kindly note that VFD Group has in an agreed trade sold a significant block of its stake in NEM Insurance Plc. The sale occurred in conjunction with other key stakeholders of the insurance company.

“We have had extensive discussions with the management and board of NEM Insurance Plc in the last couple of months over our interest in working with the team, to unlock the latent value we see in them.

“However, as we could not agree on the modalities for working together in pursuing this vision, we recently reached an amicable understanding and have thus decided to exit our investment in this great company.

“A combined block of one billion, six hundred million (1,600,000,000) ordinary shares of NEM Insurance Plc, representing about 30 percent of the latter’s issued share capital, was sold to new shareholders. The trade which happened at year end 2018 closed at a significant premium to the closing price on the floor of the Exchange.”

The company further disclosed that it has successfully raised N2.78billion from rights issuance and private placements held last months.

“We had planned to raise N1billion from existing shareholders via rights and the other N1billion via private placement from new shareholders December 3, 2018, with Kairos Capital Limited acting as the financial adviser, and closed on December 31, 2018. Despite the short time-lines, the capital raise was successful, as it was oversubscribed by 39 percent on both counts. “

This over-subscription is indicative of the confidence existing and new shareholders have in VFD Group.