African Alliance Insurance Plc suffered a loss of N2 billion in a sale and repurchase equity deals involving the group’s shareholding in its pensions affiliate.
A regulatory report filed by the company showed that it sold its 49 per cent equity stake in Pensions Alliance Limited (PAL) to Conau Trade and Investment Co. Limited at N16.6 billion and subsequently repurchased the same 49 per cent equity stake from Conau Trade and Investment Co. Limited at N18.6 billion.
The sale and repurchase deals involved 539 million shares of PAL held by African Alliance Insurance.
According to the details of the transactions, while African Alliance Insurance received initial value from Conau Trade and Investment Co. Limited, it had to combine cash, equity swap and property divestment to make up the N18.6 billion repurchase value.
African Alliance Insurance’s N18.6 billion repurchase value included cash, its shareholding in Universal Insurance Plc and its property at 29 A & B Akin Adesola Street, Victoria Island, Lagos State.
Shareholders of the company however approved the two transactions at their annual general meeting last week. The audited report and accounts of African Alliance Insurance showed that it declared a profit before tax of N5.67 billion in 2020 compared with a loss of N7.04 billion in 2019. The company’s asset base also rose by 29 per cent from N40 billion to N56.3 billion.
Managing Director, African Alliance Insurance, Joyce Ojemudia, assured shareholders of management’s commitment to increasing corporate efficiency and returns while growing market share.
According to her, the main focus of the company is to grow market share substantially by massive beef-up of the sales team and provision of necessary tools to aid marketing activities.
“We will reopen branches in locations we have found promising and enhance our presence in existing locations. Our quest to maintain physical presence resonates with our integrity drive as insurance is a business of trust especially amongst the retail market.
“This effort will be supported by digital technology as we adopt a two-prong onslaught on the market,” Ojemudia said.
She also listed as priorities the renewal of the company’s ISO certification as a business tool to enhance market confidence; staff training and retraining to aid knowledge acquisition; recruitment into key technical areas as well as massive IT upgrades to support the business goals.