Himalayan General Insurance (HGI) Successfully Merges With Everest Insurance (EIC) | Begin Joint Operation From Shrawan 1
July 17, 2022 | Investopaper
Himalayan General Insurance Company Limited (HGI) has successfully completed merger with Everest Insurance Company Limited (EIC). This is the first merger among the non-life insurance companies in Nepal.
The company will operate in the name of ‘Himalayan Everest Insurance Limited’ after the successful completion of the merger process. The joint operation in the name of ‘Himalayan Everest Insurance Limited’ has started from Shrawan 1, 2079 BS [July 17, 2022].
Nepal Insurance Board (Beema Samiti) had already provided the final approval for the merger and given green signal for the joint transaction. Both the companies had passed the proposal of merger from their respective Special General Meeting (SGM) held on Ashad 2, 2079 BS.
After the due diligence audit, the companies have merged in the ratio of 85:100. This means that every 85 shares of HGI will be equal to the 100 shares of EIC.
Previously, the two insurance companies signed a preliminary agreement (MOU) for merger on Baisakh 22, 2079 BS.
Due to merger agreement, the trading of shares of both companies had remained halted in Nepse. The last trading price (LTP) of HGI & EIC stood at Rs. 520 and Rs. 500 respectively.
As of Chaitra’s end 2078 BS, Himalayan General Insurance had a paid-up capital of Rs. 117.35 crores while Everest Insurance had a paid-up capital of Rs. 125.46 crores.
After the completion of merger, the paid-up capital of ‘Himalayan Everest Insurance Limited’ has reached Rs. 223.99 crores. Likewise, the total premium collection is at Rs. 319.26 crores while the Insurance Fund stood at Rs. 113.72 crores.
As per the direction of Beema Samiti, the regulatory body, the non-life insurance companies are required to meet the minimum capital of Rs. 250 crores by the end of Chaitra, 2079 BS. Hence, these two non-life insurance companies have opted for merger in order to reach the capital requirement.
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