By Dipo Olowookere
An Anglophone West Africa Private Equity firm, Verod Capital Management, is offering over N5 billion for the acquisition of Law Union & Rock Insurance Plc.
Already, the board of the insurance company has considered the offering, but awaiting approvals from the National Insurance Commission (NAICOM), Securities and Exchange Commission (SEC), Federal Competition and Consumer Protection Commission, and the Nigerian Stock Exchange (NSE).
The board, in a disclosure on Friday, said it would present this to shareholders after securing approvals of these regulatory agencies.
Verod, which focuses on investing equity and equity linked capital in growth companies across various consumer-driven sectors in Nigeria, including in particular, the insurance industry, wants 100 percent purchase of the company’s issued share capital at a unit price of N1.23.
Business Post reports that Law Union & Rock Insurance has total outstanding shares of 4.3 billion with a market capitalisation of N3.9 billion as at the close of transactions on Friday, February 28, 2020. Share price of the firm dropped 5 kobo or 5.26 percent to 90 kobo per unit.
The board of Law Union explained that the binding offer of N1.23 per share it received from Verod “represents a premium of 208 percent to the 60-day volume weighted average share price and 140 percent of the company’s closing share price on February 26, 2020.”
“The board has fully considered this offer and will, subject to obtaining all relevant regulatory approvals from the National Insurance Commission (NAICOM), Securities and Exchange Commission (SEC), Federal Competition and Consumer Protection Commission, and the Nigerian Stock Exchange, recommend the offer to the shareholders of the company, for their consideration and approval,” it added.
“Further details will be communicated to shareholders of the company in due course. Shareholders of Law Union are advised to exercise caution when dealing in the company’s shares until a further announcement is made,” the board said.
