Sagarmatha Insurance Company To Merge With Lumbini General Insurance At Share Swap Ratio Of 100:80
February 1, 2023 | Investopaper
Sagarmatha Insurance Company Limited (SIC) and Lumbini General Insurance Company Limited (LGIL) are going to undergo merger with each other.
Both the companies have signed the final agreement for merger on Magh 17, 2079 BS. The share swap ratio for merger has been finalized at 100:80. This means that every 100 shares of SIC will convert into 100 shares of new company formed after merger. Likewise, every 100 shares of LGIL will convert into 80 shares of the company after merger.
The company will operate in the name of ‘Sagarmatha Lumbini Insurance Company Limited.’ After the adjustment of the proposed bonus share of the fiscal year 2078/79 and the swap ratio, the paid-up capital will reach Rs. 262.26 crores.
Sagarmatha Insurance and Lumbini Insurance will have 3-3 directors on the board. Mr. Chunky Chettri, current CEO of Sagarmatha Insurance, will be the the chief executive.
Earlier, both the companies had signed a preliminary agreement (MOU) for merger on Ashad 30, 2079 BS.
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.
As of Poush’s end 2079 BS, Sagarmatha Insurance has a paid-up capital of Rs. 133.36 crores while Lumbini General Insurance also has a paid-up capital of Rs. 131.27 crores.
Previously, Himalayan General Insurance Company Limited (HGI) and Everest Insurance Company Limited (EIC) have successfully undergone merger and will commence joint operation from Shrawan 1, 2079 BS. Likewise, Sanima General Insurance (SGI) and General Insurance (GIC), have completed merger and started integrated transaction from Karthik 7, 2079 BS.
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