AIICO Insurance Plc Acquires 5% Stake in InfraCredit

It's been reported that AIICO Insurance Plc recently acquired a 5% shareholding in Infrastructure Credit Guarantee Company Limited.

In the statement released by Infrastructure Credit Guarantee Company Limited (InfraCredit), the firm said that AIICO is now the second home-based institutional investor to be accepted by the infrastructure credit guarantee institution. The first domestic institutional investor was Leadway Assurance Plc.

The statement reads, 

Further to this new equity investment, InfraCredit’s paid-in capital base will increase to $175.14m (c. NGN148.55bn) translating to an aggregate guarantee issuing capacity of up to NGN742.77bn (c.USD 875.7 million). The equity investment will be part of InfraCredit’s core capital and will enhance InfraCredit’s guarantee issuing capacity to sustain InfraCredit’s ‘AAA’ credit rating. It will also result in the diversification of InfraCredit’s ownership structure in line with its envisioned capital structure. InfraCredit would continue to deploy innovative credit enhancement solutions in mobilizing private sector financing for infrastructure projects in key sectors of the Nigerian economy.

Enlightening more about that investment, Babatunde Fajemirokun, the Chief Executive Officer of AIICO Insurance, states that it signalled its commitment to contributing to the growth of the country.

He said, 

• This investment is the evolution of what we at AIICO Insurance believe will be a long-term partnership with InfraCredit. Over the past two years, AIICO Insurance has invested in InfraCredit guaranteed bonds and participated in novel financing arrangements promoted by the company to bring infrastructure investment to areas that have been significantly underserved.

• With this investment, AIICO Insurance underscores its commitment to bridging the infrastructure gap in the country, partnering with InfraCredit for the long haul.

In the onboarding of AIICO as a new shareholder, Sanjeev Gupta, the Chairman of the InfraCredit Board of Directors, said,

• AIICO’s investment is in line with our vision of creating a strong partnership between the public and private sectors. This partnership aims to attract private sector capital for sustainable infrastructure financing. 

• This investment marks another significant turning point and a significant milestone for InfraCredit, as we aim to increase private sector involvement in the ownership structure.

Speaking on this, the CEO of InfraCredit, China Azubike, stated, 

• The admission of AIICO Insurance, the second private domestic institutional investor in InfraCredit, reinforces confidence in the sustainability of InfraCredit’s unique business model. AIICO’s equity investment further strengthens our core capital base and expands our guarantee capacity as we continue to act as a catalyst to attract domestic credit from pension funds, insurance firms, and other long-term institutional investors into credit-worthy infrastructure projects.

• This equity investment from AIICO aligns with our sponsor’s strategic objective to broaden our investor base through private sector participation, thus expanding our capitalization and strengthening our capacity to deepen market penetration. We are pleased to have AIICO as a shareholder, and we aim to strengthen our cooperation towards advancing sustainable finance for impactful infrastructure projects in Nigeria.

About AIICO Insurance

The firm was established in 1963 and is considered one of the largest life insurers in Nigeria and a principal underwriter for general insurance by premiums written.