June 13, 2023 | Investopaper
Prabhu Life Insurance Company Limited (PLI) and Mahalaxmi Life Insurance Company Limited are going to undergo merger with each other. Nepal Insurance Authority has provided the final approval for merger on Jestha 29, 2080 BS.
The companies have already passed the agenda of merger from their respective Annual General Meeting (AGM) held on Jestha 26, 2080 BS.
Earlier, both the companies have signed a preliminary agreement (MOU) for merger on Ashad 30, 2079 BS. The companies have agreed to merger at share swap ratio of 1:1.
As per the direction of the regulatory body Nepal Insurance Authority, the life insurance companies are required to meet the minimum capital of Rs. 500 crores. Hence, these two life insurance companies have opted for merger in order to reach the capital requirement.
Due to merger agreement, the trading of shares of principal shareholders of PLI has remained halted in Nepse. Mahalaxmi Life Insurance has not issued shares to the public. Hence, the shares are not listed in NEPSE.
At present, Prabhu Life Insurance has a paid-up capital of Rs. 219.60 crores while Mahalaxmi Life Insurance has a paid-up capital of Rs. 140 crores.