The Federal Republic of Germany, represented by the Federal Ministry for Economic Cooperation and Development (BMZ), has acquired about 39.25 percent stake in Lagos-based Royal Exchange General Insurance Company Limited (REGIC).
This was done through the InsuResilience Investment Fund (IIF), which was set up on behalf of the German government by KfW and managed by Swiss based Impact Investment Manager, BlueOrchard Finance Ltd.
REGIC, one of the largest non-life insurance companies in Nigeria, is a subsidiary of Royal Exchange Plc, a leading player in agriculture insurance listed on the Nigerian Stock Exchange (NSE).
In a notice to investing public and its shareholders on Thursday, Royal Exchange said the IFF, through its activities, is expected to reach out to more than one million Nigerian farmers by 2025.
BlueOrchard, in a statement on its website today, disclosed that proceeds of the investment will help REGIC to spur growth by increasing its risk capital and supporting its underwriting capacity in agriculture, hereby extending its outreach to low income farmers.
Royal Exchange noted in its statement that the investment from IFF has been approved by the regulator of REGIC, the National Insurance Commission (NAICOM).
“The history, team and commitment of REGIC to agriculture insurance make it a great addition to our portfolio. REGIC is uniquely positioned to capture the opportunity presented by 30 million under insured small scale farmers in Nigeria.
“We are thrilled to partner with and support REGIC with capital, technical assistance and our international network in the agriculture insurance space, with the objective to increase the resilience of small scale farmers to climate change,” Senior Vice-President Private Equity at BlueOrchard, Mr Ernesto Costa, was quoted as saying.
“REGIC has entered into strategic alliances with various stakeholders in the agricultural space to drive insurance within that sector of the economy. Agriculture and retail insurance, we believe is the future of insurance and at Royal Exchange, we will continue to develop products and services to ensure that we remain relevant in this space.
“REGIC is determined to take advantage of growth initiatives available in the industry, while leveraging on technology to expand its revenue base and stronger bottom-line,” Chairman of Royal
Exchange Plc, Kenny Ezenwani Odogwu, stated.
It was disclosed that Ernst & Young Nigeria acted as the financial due diligence advisor to IIF, while Alkebulan Ltd acted as the financial and corporate advisor to REGIC for this transaction.
Alos, Udo Udoma & Belo Osagie acted as the legal advisor to IIF, while Sefton Fross acted as legal advisor to REGIC.
