FML shareholders approve acquisition of NicozDiamond, as changes in management looms
Insurance24 Reporter
HARARE, Management changes are now visibly looming at NicozDiamond and Tristarinsurance after shareholders of First Mutual Holdings (FML) approved at an EGM the acquisition of 80.92% the entire issued share capital of Nicoz which will result in merging of the two short term insurers.
FML group chief executive officer Doug Hoto in an interview after the extra-ordinary general meeting the acquisition process will take at least 12 months as there is need to go through several other regulatory approvals.
The Group will seek approvals from the Competitions and Tarrifs Commission, Ministry of Finance, insurance regulator the Insurance and Pension Commission (IPEC) among others.
Hoto however said the processes will happen simultaneously within the targeted time frame. According to Hoto, an additional $50 mln will be realised to the Group’s balance sheet of $229 mln as at December 2016.
As at 31 July 2017, Nicoz had a market capitalisation of $17.7 mln, price to book value of 0.98x and total assets of $41.2 million as at December 2016.
However, Hoto said the company will also make a mandatory offer to minorities of the remaining 19.08% shareholders of NDL upon it will decide on the future NicozDiamond on the Zimbabwe stock Exchange (ZSE).
Meanwhile, at the EGM the shareholders also approved FML’s intention to raise $17.25 mln through a renounceable rights offer whose proceeds will finance the NDL acquisition transaction.
Terms and conditions of the offer is that FML proposes to raise $17.25 mln by way of a renounceable offer of 210,371,395 new FML shares with a nominal value of $0.001 at a ratio 44 new FMHL ordinary shares with a nominal value of $0.001 per share for every 100 FMHL ordinary shares with a nominal value of $0.001 per share held as of the FMHL Rights Offer Record date at price of 8.20 cents per FMHL ordinary share. The rights offer is underwritten 90% by NSSA and 10% by LHG Malta.
Zimre Holdings is the second largest shareholder in Nicoz at 30.03%, but the company is in talks with NSSA over possible disposal of the holding.
