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International Energy Insurance Seeks Buyer to Meet NAICOM Recapitalisation Requirements

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International Energy Insurance Company has notified its shareholders that it has obtained the approval of the National Insurance Commission (NAICOM) to engage a proposed Acquirer for a business combination transaction.

This is part of its efforts to meet the capitalisation requirements as directed by NAICOM.

The company hence has entered a close period for the trading of its shares from 31 May 2021. During the closed period no director, persons discharging managerial responsibilities, and advisers of the Company and their connected persons are expected to deal in the securities of the Company.

The closed period will remain in force until 24 hours after the details of the transaction are released to the public.

The insurance industry in Nigeria is undergoing a recapitalisation exercise that will require operators to shore up their paid-up share capital to as much as 300 percent.

NAICOM had on 3rd June 2020 extended the compliance deadline of the ongoing recapitalization exercise in the insurance industry to 30st September, 2021, with the first phase to end December 31, 2020.

The Commission said insurance companies are expected to recapitalise 50 percent of the paid up share capital requirement by end of 2020, and reinsurance companies 60 percent, while the remaining 50 percent and 40 percent respectively will be completed by end of September 2021.

The segmentation of recapitalisation according to NAICOM, shows life companies operating currently with N2 billion will increase to N4 billion by 31st December 2020, as first phase and to N8 billion by 30th September 2021.

General business companies operating currently with N3 billion will increase to N5 billion by 31st December 2020, as first phase and to N10 billion by 30th September 2021.

Composite business companies operating currently with N5 billion will increase to N9 billion by 31st December 2020, as first phase and to N18 billion by 30th September 2021, while Reinsurance companies operating currently with N10 billion will increase to N12 billion by 31st December 2020, as first phase and to N20 billion by 30th September 2021.

According to the Commission, any insurance and reinsurance company that fails to meet the first phase of the capitalization may be restricted on the scope of business they will transact.

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