NGX Approves Sovereign Trust Insurance Plc Additional 2.864 Billion Ordinary Shares

The Nigerian Exchange Limited (NGX) has approved Sovereign Trust Insurance PLC an additional 2.864 billion ordinary shares of 50 kobo each per share on its daily official list.

This development was made known in the Exchange’s weekly report; the additional shares arose from the Sovereign Trust Rights Issue.

The NGX stated that with the listing of the additional shares, the total issued and fully paid-up shares for Sovereign Trust have now increased from 11.364 billion to 14.228 billion ordinary shares.

It reads,

• 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 listed on January 18, 2024, 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.

In 2023, Sovereign Trust Insurance added 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 that after the deduction of estimated issue costs and expenses of N40.243 million, representing 2.83% of the gross issue proceeds, the proceeds will be used for development of retail products, enhancement of investment portfolios, working capital, and offer expenses, LEADERSHIP reports.

On this, Oluseun Ajayi, the chairman of STI, said,

• The shareholders agreed that the company should raise additional equity capital up to the maximum limit of the authorised 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 noted that the rights issue will not only rank the company amongst its competitors but will also provide an opportunity for the insurer to expand its market share in the ever-competitive Nigerian insurance industry that has seen the entrance of a few global players in recent years.

He added that, 

• As we look ahead, the Board believes that the fresh injection of the net proceeds of N1.38 billion would expand the company’s business operations competitiveness and increase its penetration of the insurance market.

• It is the privilege of the board of directors to build shareholder value over the long term and encourage all shareholders to participate fully in this rights issue.