14 August 2017
HARARE – First Mutual Life Holdings Limited (FMHL) last week announced
plans to pursue a rights offer to raise $17,25 million, the businessdaily
The implementation of the rights offer will depend on the Zimbabwe Stock
Exchange-listed FMLH shareholders who are expected to approve the
transaction at an extraordinary general meeting (EGM) to be held in the
capital at the end of this month.
The funds will be earmarked towards acquisition of NicozDiamond’s 80,92
The transaction will be 90 percent underwritten by the National Social
Security Authority (Nssa), the majority and controlling shareholder of
both FMHL and NicozDiamond; while 10 percent will be underwritten by LHG
NSSA and LHG have committed to follow their respective rights and will
therefore underwrite the portion outside their combined portions.
In a circular to shareholders published last week FMHL said: “FMHL
proposes to raise $17,25 million by way of a renounceable rights offer of
210 371 395 new FMHL shares with a nominal value of $0,001 at a ratio 44
new FMHL ordinary shares with a nominal value of $0,001 per share for
every 100 FMHL ordinary shares with a nominal value of $0,001 per share
held as of the FMHL rights offer record date at a price of 8,20 cents per
FMHL ordinary share.”
The proposed NicozDiamond acquisition, will result in the merging of
NicozDiamond and Tristainsurance Company, who are both short-term insurers
into a single short-term insurance entity.
The insurance firm will also seek shareholders’ approval at the EGM to
merge the two short-term insurance companies.
According to the circular to shareholders, FMHL added: “Subsequent to the
acquisition of NicozDiamond, the board proposes to merge NicozDiamond and
Tristar operations into a single short-term insurance entity.
The mechanism of the proposed merger will depend on FMHL’s ultimate
shareholding in NicozDiamond and the process is expected to take up to 24
months to complete.