HomeBusiness DigestZimnat closes in on AIG

Zimnat closes in on AIG

Eric Chiriga

ZIMNAT Lion Insurance Company Ltd (Zimnat) is close to taking over short-term insurance company AIG Zimbabwe (AIG) through a share transfer.

Helvetica, sans-serif”>”Zimnat will acquire the entire issued share capital of AIG, which is 10 million ordinary shares of $1,00 each,” Sam Matsekete, the company secretary for Zimnat, said.

Matsekete said Zimnat would then issue 1,1 billion ordinary shares in the company (Zimnat) to TA Holdings, the current majority shareholder in AIG.

However, the transaction is subject to approval by Zimnat shareholders at an extraordinary general meeting (EGM) to be held on June 28.

Zimnat has proposed that the balance of the authorised but unissued shares of the company, after the proposed merger, be placed under the control of the directors for an indefinite period.

The company is also going to amend its Articles to increase the authorised share capital from $18 million divided into 1,8 billion ordinary shares of $0,01 each, to $30 million divided into 3 billion ordinary shares of one cent each.

Zimnat is understood to have structured the deal in a way that will allow it access to the management of the company and at the same time access to AIG’s clients and markets.

Zimnat’s merger with AIG comes after the company acquired a controlling interest in another short-term insurance company, Lion of Zimbabwe Insurance Company, to form Zimnat Lion Company.

The merger of the two companies resulted in the new entity becoming the country’s leading short-term insurer.

TA Holdings Ltd has a 54,63% stake in Zimnat Lion through its 100% holding in Freecor Holdings Ltd and Bude Holdings Ltd. Freecor and Bude own 41,29% and 13,34% of Zimnat Lion, respectively.

Zimbabwe has one of the most well developed insurance sectors on the continent. In 2003 it had 26 short-term insurers, nine life assurers and 4 500 pension funds.

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