Separate announcement by both listed companies on Tuesday stated that IGI (a general insurance company listed on the KSE) would acquire ‘‘the entire’’ shareholding in Alico, which stands at 41 million shares of Rs10 each. The acquisition would form 81.97 per cent of the total issued, subscribed and paidup capital of the company. — File Photo

KARACHI: IGI Insurance Limited (IGI) and American Life Insurance Company (Alico) entered into a share purchase agreement on Monday, by virtue of which IGI will acquire the entire sponsors-institutional holding in Alico.

The companies had first declared their intention of purchase-sale on September 25, 2012. It was subject to the successful completion of due diligence.

Separate announcement by both listed companies on Tuesday stated that IGI (a general insurance company listed on the KSE) would acquire ‘‘the entire’’ shareholding in Alico, which stands at 41 million shares of Rs10 each. The acquisition would form 81.97 per cent of the total issued, subscribed and paidup capital of the company.

The Tuesday’s announcement was made in compliance with Clause (xx) of the Listing Regulation No 35 under the Code of Corporate Governance.

The successful consummation of the Transaction was also subject to regulatory approvals and completion of the requirements pursuant to the Takeover Ordinance.

In pursuance to the Listed Companies (Substantial Acquisition of Voting Shares and Takeovers) Ordinance, 2002, IGI would have to acquire through tender offer a specified number of shares from the public.

The announcement by IGI disclosed the Alico take-over transaction to take place at Rs20 per share.

As the acquisition of majority equity was to be conducted at nearly Rs14.75 lower than the market price of the Alico stock, the share in the company at the KSE, plunged by Rs1.73 to hit the 'lower lock', representing the maximum permitted 5 per cent of the opening value and close at Rs33.02 on trading in just 1000 shares.

Earlier, several other players including Adamjee Life Assurance, EFU Life, Nishat Group and Packages Group were thought to have expressed varying degrees of interest in buying out American Life Pakistan the subsidiary of Metropolitan Life Insurance Company (Metlife) quoted on the KSE as “American Life Insurance”.

The company on Tuesday did not specify the reason for its sale to IGI.

Looking back on the international scene, it was on Nov 1, 2010 that Met Life acquired the international leader in life-insurance business, American Life Insurance Company (Alico), from American International Group (AIG), after paying an approximately $7.2 billion in cash and $9.0 billion in MetLife equity and other securities.

As regards Alico Pakistan, In Mar 2012, the company had made an interesting announcement of having paid the largest ever life insurance industry’s death claim in Pakistan. The claim of Rs48 million covered Life Time Income with guaranteed payments for 20 years.

More From This Section

Dar eyes forex reserves at $15bn by end-Sept

Pakistan's forex reserves are currently at $11.67bn after SBP received $2bn on Wednesday through floating of Eurobonds.

Sindh revenue collection jumps by 23pc

Revenue collection in Sindh between July 2013 and March 2014 stood at Rs23.7bn, witnessing an increase of 23 per cent.

Treasury bills losing attraction

Govt failed to mobilise banks for T-bills auction as the bids it received for the auction were less than the set target.

Punjab textile units start downsizing

Several textile units have incurred losses due to short gas supply, long power cuts, appreciating rupee against US$.


Comments are closed.
Explore: Indian elections 2014
Explore: Indian elections 2014
How much do you know about Indian Elections?
How much do you know about Indian Elections?
Cartoons
E-PAPER
Front Page