Lahore January 19 2022: Adamjee Insurance Company Limited (AICL) is offering its 10 percent stake in Adamjee Life Assurance Company Limited (ALACL) through Initial Public Offering at floor price of PKR 28 with cap of 40 percent for listing at Pakistan Stock Exchange (PSX).
The Offer comprises 25,000,000 Ordinary Shares of the face value of PKR 10/- each, which constitutes 10 percent of the total post-IPO paid-up capital of the Company.
The bidders shall be allowed to place bids for hundred percent (100%) of the Offer size and the Strike Price shall be the price at which the hundred percent (100%) of the Offer is subscribed. However, the successful bidders shall be provisionally allotted only seventy-five percent (75%) of the Offer size i.e., 18,750,000 shares, and the remaining twenty-five percent (25%) i.e., 6,250,000 shares shall be offered to the retail investors.
The entire Offer of 25,000,000 Ordinary Shares will be offered through the Book Building process at a Floor Price of PKR 28/- per share with a price band of 40% above the floor price i.e., PKR 39.2/- per share.
The registration of eligible investors will commence at 9:00 am on 4th February 2022 and will close at 3:00 pm on 10th February 2022. Registered investors can place bids from 9th February 2022 to 10th February 2022 from: 9:00 am to 5:00 pm.
Public portion can be subscribed on 16th February 2022 and 17th February 2022 from 9:00 am to 5:00 pm.
The principal purpose of the Offer for Sale is to enable the holding company to realize a gain on its investment in ALACL. Further, the public offering will enable the Company to broaden its shareholder base by bringing in public shareholders, HNWIs and Financial Institutions. It will also aid in increasing ALACL’s transparency and enhance good governance measures.
Adamjee Life Assurance Company Limited (ALACL) is engaged in the life insurance business carrying on nonparticipating business only. In reference to life insurance business, non-participating business means contracts of life insurance where the policyholder is not entitled to participate in the profits or surpluses (in the form of bonuses or dividends) of life insurance provider.
ALACL is a subsidiary of Adamjee Insurance Company Limited (AICL). AICL is one of the largest general insurance companies in Pakistan, incorporated as a Public Limited Company on 28 September 1960 and is listed on Pakistan Stock Exchange Limited. AICL was listed on the Exchange in 1961. AICL has a unique advantage of having a regional presence in the United Arab Emirates (UAE) and maintains its standing through an unwavering commitment to its corporate philosophy. AICL’s competitive advantage is achieved by having the largest paid-up capital and reserves among general insurance companies, and a well-diversified business portfolio. AICL currently holds 249,998,250 shares or 99.999% of the paid-up capital.
The Company offers both Conventional Life Insurance and Family Takaful policies. Under Conventional Life Insurance business, the Company underwrites non-participating individual life, non-unitized investmentlinked, unitized investment-linked and group life/ group credit life business in four statutory business funds, namely, the Conventional Business Fund, the Accident & Health Business Fund, the Non-unitized InvestmentLinked Business Fund, and the Unit Linked Business Fund.
The non-unitized and unitized investment linked plans are both insurance cum saving plans. Under nonunitized investment linked plans, the investment return on the account value of the policy is based on the portfolio return of the non-unitized investment linked statutory fund. There are no separate investment funds available for the policyholders to choose from. Whereas under Unit Linked policies, policyholders have the choice to select the investment funds based on their risk appetite. The premium (or portion of the premium) is used to purchase the units of the investment fund and the cash value of the policy will vary based on the returns of the chosen investment fund.
On the Takaful side, the Company underwrites Individual unitized investment-linked Family Takaful Business and Group Family Takaful/credit protection business in “Individual Family Takaful Unit Linked Business Fund” and “Group Family Takaful Business Fund” respectively.
The Company was granted the authorization on May 04, 2016, under Rule 6 of Takaful Rules, 2012 to undertake Takaful Window Operations in respect of family Takaful products by SECP and commenced Window Takaful Operations from July 14, 2016. The Company also commenced its Group Family Takaful Business in the second quarter of 2020.
The life insurance industry is regulated by the Securities & Exchange Commission of Pakistan (SECP). Currently, ten companies are operating under the life insurance license issued by SECP including State Life Insurance Corporation. The industry is collectively represented under the common platform of the Insurance Association of Pakistan.
In accordance with the requirements of the Insurance Ordinance 2000, the Company has established a shareholders’ fund and the required statutory funds in respect of each class of its life insurance business.
The Company is backed by Nishat group of companies, which is one of the leading and most diverse business conglomerates of Pakistan. It has a strong presence in various most important business sectors of the region namely Textiles (Nishat Mills, Nishat Linen), Cement (D.G. Khan Cement), Financial Services (MCB Bank, MCB Islamic Bank, Adamjee Insurance, Adamjee Life Assurance, Security General Insurance), Power (Nishat Power, Nishat Energy, Pakgen Power, Lalpir Power) and Automobile (Hyundai Nishat Motor). In addition, it also has a reasonable market share in hospitality, dairy, paper products, aviation, agriculture, and real estate sectors.
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