Nigerian insurer Law Union and Rock Insurance Plc’s shareholders have accepted an offer of N1.23 per share for every 50 kobo ordinary share from Verod Capital Management.
The company’s board approved Verod Capital’s offer to purchase its entire issued share capital after both entities executed a a Transaction Implementation Agreement, through Verod’s investment vehicle, Kanuri LUR limited. Verod Capital is controlled by investment bankers Danladi Verheijen and Eric Idiahi.
Shareholders of Law Union and Rock Insurance approved the the agreement at the company’s fifty-first Annual General Meeting and Court Ordered Meeting held at the MUSON Center, Lagos, where the Scheme of Arrangement for the proposed acquisition of the company was discussed.
Law Union and Rock’s paid up capital has been increased from N3 billion to N10 billion in line with the regulations of the National Insurance Commission (NAICOM), which has directed all insurance companies to raise their share capital to the statutory minimum on or before June 30, 2020.
Remi Babalola, chairman, Law Union and Rock Insurance said: “Following negotiations with Kanuri LUR and further to advice from its advisers, the Board resolved to recommend the Proposal to the Shareholders for their kind consideration at a meeting to be convened by an order of the Federal High Court. The Board has further resolved to effect the proposal by way of a Scheme of Arrangement under Section 539 of the Companies and Allied Matters Act Chapter C20, laws of the federation of Nigeria 2004 as your Board believes that same will serve the best interests of both the Company and its shareholders.”
Mr Babalola added that Kanuri LUR’s proposal formally announced its intention to acquire Law Union resulting in the Company being re-registered as a private company, noting that the proposal will be implemented through Kanuri LUR and its designated nominee, who will receive all the shares under the Scheme upon the Scheme taking effect.
According to the proposed Scheme Consideration, the offer represents a total value of N1.23 per share, a 129 per cent of the last traded share price of the Company on February 27, 2020 at N0.95 per share, being the last business day prior to the date the execution of the TIA and announcement on the Exchange, and a 208 per cent of the 60 – Traded Day weighted average share price of N0.59 per share as at February 27, 2020.
Law Union’s chief executive Ademayowa Adeduro said that Law Union and Rock’s performance improved over the years especially since its acquisition a the consortium of investors (Alternative Capital Partners and Swanlux Solutions and Services Limited in 2012).