Prestige Assurance to reduce share capital 

Prestige Assurance Plc has notified the dealing members on the Nigerian Stock Exchange (NSE) to reduce the company’s share capital available on the Exchange.

A release signed by the acting head, Listings Regulation Department of NSE, Godstime Iwenekhai said, “Dealing members are hereby notified that Prestige Assurance Plc has made an application to the NSE for a ‘No Objection’ to its proposal to reduce the company’s share capital from N2.69 billion being 5.37 billion ordinary shares of 50 kobo each to N1.91 billion being 3.82 billion ordinary shares of 50 kobo each in the issued and fully paid up ordinary shares of the Company.”

It added that the share capital so reduced would be applied in writing off the capital of the Company which was lost or unrepresented by available assets.

Prestige explained that the essence of the capital reconstruction is to enable the company wipe out its accumulated retained losses of N776.51 million. It stated further, that the reconstruction will reposition the company on a trajectory for subsequent accumulated retained profit, create more value to its shareholders, allow the company to declare dividend and improve its perception in the market, thereby making it more competitive.

Recently at the company annual general meeting, the board of directors of Prestige received shareholders’ approval to reduce the issued share capital of the company from N2.69 billion to N1.91 billion by cancelling and extinguishing 1.55 billion of the issued ordinary share of 50 kobo each.

Commenting on the share capital reduction, chairman of the company, Hassan Usman explained to shareholders that it will enable the company wipe out its accumulated retained losses, reposition the company on a trajectory for subsequent accumulated retained profit, create more value to its shareholders, allow the company declare dividend and improve its perception in the market thereby making it more competitive.

Other details of the share reduction according to the document that was packaged by Planet Capital, the financial adviser to Prestige Assurance Plc, showed that the share capital reconstruction entails each shareholder to surrender about 11 shares for every 38 eight held.

While the corresponding reduction in the share capital will be matched by the issuance of bonus shares from the share premium account structured for this purpose where the value of the cancelled shares will be restored, thus ensuring that there’s no loss whatsoever to shareholders.