The Nigerian Exchange Limited (NGX) has admitted Sovereign Trust Insurance Plc’s additional 2.864 billion ordinary shares of 50 kobo each per share on its daily official list.
This was stated on the Exchange’s weekly report, the additional shares arose from Sovereign Trust’s Rights Issue.
The NGX noted that with the listing of the additional shares, the total issued and fully paid-up shares of Sovereign Trust have now increased from 11.364 billion to 14.228 billion ordinary shares.
“Trading Licence Holders are hereby notified that an additional 2.864 billion ordinary shares of 50 kobo each per share of Sovereign Trust Insurance were on January 18, 2024, listed on the daily official list of Nigerian Exchange Limited.
“The additional shares listed on NGX arose from the Sovereign Trust’s rights issue of 2.864 billion ordinary shares of 50 kobo each per share. With this listing of the additional ordinary shares, the total issued and fully paid-up shares of Sovereign Trust have now increased from 11.364 billion to 14.228 billion ordinary shares of 50 kobo each,” he stressed.
In 2023, Sovereign Trust Insurance raised new equity funds of N1.421 billion through rights issue from its existing shareholders.
STI stated that the proceeds of the rights issue will be used for business expansion and to meet working capital requirements, saying, after the deduction of estimated issue costs and expense of N40.243 million, representing 2.83 per cent of the gross issue proceeds, the proceeds will be used for development of retail products, enhancement of investment portfolio, working capital and offer expenses.
The chairman of STI, Oluseun Ajayi stated that, “the shareholders agreed that the company should raise additional equity capital up to the maximum limit of the authorized share capital, whether by way of a special placement, public offer, rights issue or a combination of any of them, saying, the board met, and in line with the strategic objective of the company, resolved to raise capital via a rights issue.”
He said, the rights issue will not only give the company a competitive edge, but it also provides an opportunity for the insurer to expand its share of the market in the ever-competitive Nigerian insurance industry that has seen the entrance of a few global players in recent years.
Ajayi further said, the capital raising exercise is in line with the company’s goal of being a dominant player in the insurance industry, with market leadership positions in the sectors it participates.
He added that, “as we look ahead, the Board is of the considered opinion that the fresh injection of the net proceeds of N1.38 billion would expand the company’s business operations, competitiveness and also increase its penetration of the insurance market.
“It is the privilege of the board of directors to serve with a view to building shareholder value over the long term, and to encourage all shareholders to participate fully in this rights issue.”
