AIICO completes restructuring cancels 1.87b shares

AIICO Insurance Plc has completed its group corporate restructuring and consolidation as the insurance group seeks to enhance its corporate efficiency and reduce costs.

The restructuring included the consolidation of other subsidiaries, such as AIICO General Insurance Company Limited and AIICO Asset Management Company Limited.

The consolidation led to cancellation of 1.87 billion ordinary shares of AIICO Insurance Plc, reducing the issued and fully paid ordinary shares of the company to 6.93 billion ordinary shares.

It came on the heels of a $20 million convertible loan deal between Aiico Insurance Plc and the International Finance Corporation (IFC).

AIICO had indicated in January that it had opened discussions on a $20 million convertible loan deal that may see IFC holding substantial equity stake in the Nigeria-listed insurance company.

Regulatory filing indicated that the IFC, the private sector arm of the World Bank, plans to extend $20 million, about N3.4 billion to Aiico Insurance.

Under the arrangement, IFC has an option to convert any unpaid part of the convertible loan to equities in AIICO, referencing similar strategy that has seen IFC acquiring major stakes in many Nigerian financial institutions.

At market valuation, the convertible loan deal could see IFC holding as much as one third of Aiico’s shareholding. Aiico’s issued share capital of 8.80 billion ordinary shares of 50 kobo each is valued at N6.86 billion.

IFC had made similar arrangement to invest $12.5 million in Custodian and Allied Insurance Plc in 2012. The Custodian deal came through a 4.5 per cent convertible loan stock, an approximately N1.95 billion deal that allowed IFC to convert the debt stock into equities upon the terms of the agreement.


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