By Peter Egwuatu

CONSOLIDATED Hallmark Insurance (CHI) Plc has explained that it is not considering merger option to meet the N10 billion new capital base requirement for the insurance sector.

It also expressed optimism that the Company would meet the new capital base by June 2020.

Managing Director/Chief Executive Officer, Consolidated Insurance, Mr Eddie Efekoha, disclosed this in an exclusive chat with  Financial Vanguard  saying: “Our Company would stick to the old timeline of June deadline not the current deadline of December, 2020.”

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He said: “The Company is not considering any merger to meet the new capital requirement of N10 billion. We had a five year strategic plan which included raising our capital base even before the announcement of the increase in capital requirements by our regulatory body.

“We had already started the process in 2017 by raising N500 million by Right Issue which was fully subscribed. Now we are doing another Rights Issue of raising N1.1 billion. When that is completed we would do a private placement and if that does not take us to the capital requirements then we will consider an Irreversible not Cumulative Preference Share.”

He further said: “If we see any opportunity of acquisition we will consider it and not merger. We don’t want to dilute shareholders holding.”
Efekoha noted that the proceeds of the ongoing Right Issue would be applied towards investment in the Company’s subsidiary such as Grand Treasurers Limited, expansion of the retail business platform and working capital enhancement.

“Whilst CHI has continued to perform well on several parameters, the essence of this capital raising exercise is to enhance the capitalisation of the Company in order to meet the revised minimum statutory capital of N10 billion stipulated by the National Insurance Commission; as being the statutory requirement for the operation of a non-life (general) insurance business” Efekoha added.