By Peter Egwuatu
Shareholders of Consolidated Hallmark Insurance (CHI) Plc have approved the proposed Holding Company (HoldCo) structure for Consolidated Hallmark Insurance (CHI) Plc and all scheme of arrangement pursuant to Section 715 of the Companies and Allied Matters Act, 2020.
The shareholders gave the approval at the company’s Court Ordered Meeting held in Lagos both virtually and physically.
In accordance with the Scheme of Arrangement, the 10,840,000,000 ordinary shares of 50k each in the issued and paid-up shared capital of the company and held by the shareholders would be transferred to Consolidated Hallmark Holdings Plc.
The shares would be transferred in exchange for the allotment of 10.84 billion ordinary shares of 50k each in the share capital of the Holdco to the shareholders in proportion to their shareholding in the company to be credited as fully paid.
Addressing the shareholders at the meeting, Mr Obinna Ekezie, the company’s Chairman, said that the HoldCo structure would improve Consolidated Hallmark’s valuation by creating a structure where each subsidiary is able to operate a focused business.
According to him, the HoldCo structure will ensure that the subsidiaries operate under their separate regulatory requirements.
“Therefore, the risk that may arise from any of the businesses is isolated and does not necessarily impact all other businesses. This structure also creates a liability tax shield by placing operating companies and their assets in separate entities,” he said.
He also said that the HoldCo structure would enable Consolidated Hallmark pursue other value accretive opportunities that could arise in the near future.
“Consolidated Hallmark intends to take the necessary steps to position the Company for future opportunities across the insurance value chain.
“The Restructure is intended to mark a new chapter for the company and the Group, and enables the entities become intentional about their next phase of growth and impact on the Nigerian Insurance industry,” Ekezie said.
Speaking at the meeting, Sir Sunny Nwosu, the Founder, Independent Shareholders of Nigeria (ISAN), commended the board and management of the company for being proactive.
Nwosu who described the development as apt said that shareholders would not short changed in the restructuring going by the scheme of arrangement.
He, however, urged the board and management of the company to ensure adherence to the scheme timetable.
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