Kathmandu: Citizen Life Insurance Company has approached the Stock Exchange Board of Nepal (SEBON) to issue IPOs at a premium price to raise equity capital. The company has applied to the regulatory body going to issue an IPO at Rs. 290 including premium over face value of Rs.100.
The insurer plans to issue a total of 1.25 million equity shares to the public to raise Rs. 3.26 billion equity fund. At present, its paid-up capital is Rs. 2.62 billion which will reach Rs. 3.75 billion while excluding the premium amount collected through the IPOs. Citizen Life will need an additional Rs.1.25 billion. The company will make an additional Rs. 2137.5 billion while collecting the premium at the rate of Rs. 190. The insurer had a reserve fund of Rs.1.25 billion by the end of the second quarter of the current fiscal year. Such funds will exceed Rs. 3.38 billion after the allotment of IPOs.
Nepal Insurance Authority has already allowed four insurance companies Sun Nepal Life, IME Life, Reliable Nepal Life, and Citizen Life Insurance to issue IPOs at a premium. All these companies have submitted their application to receive a final nod from SEBON. Further, Mahalakshmi Life Insurance, which is in the process of a merger with Prabhu Life Insurance, has announced to go for a merger only after issuing IPOs at a premium value.