Joint Transaction of Sanima Life Insurance and Reliance Life Insurance to Start From Chaitra 09
Wed, Mar 22, 2023 11:14 AM on Latest, Merger/Acquistion,
The final procedure for a merger between Reliance Life Insurance Limited (RLI) and Sanima Life Insurance Company Limited (SLI) has been completed. The company had signed a merger deal at a swap ratio of 1:1.
"Sanima Reliance Life Insurance Company" has been agreed upon as the name of the new company that will be formed as a result of the merger. The companies signed the Memorandum of Understanding (MoU) on 29th Ashad, 2079.
Likewise, in accordance with the letter from the Nepal Insurance Authority and the Office of the Registrar of Companies, the merger has also received final permission. Therefore, the companies will start the joint business on Chaitra 09 i.e March 23, 2023.
At present, Sanima Life has a paid-up capital of Rs 2.08 Arba, and Reliance Life has a paid-up capital of Rs 2.10 Arba. Accordingly, the paid-up capital of the two companies will reach Rs 4.18 Arba, which is still not enough to meet the Insurance Board's capital requirements of Rs. 5 Arba.
Also, as per the guidelines for amalgamation and acquisition of companies that have registered securities issued by the Securities Board (SEBON), the share trading of both institutions shall be suspended for the purpose of matching the shares of the target institution, re-registration of securities, dematerialization and listing of securities.
According to the rule that specifies life insurance companies must have a minimum paid-up capital of Rs. 5 Arba by the end of Chaitra 2079, nine out of the nineteen life insurance companies chose to merge in order to increase their paid-up capital in the fiscal year 2078/79, making the overall life-insurance companies come down to fourteen.
The merger procedure between Prime Life, Gurans Life and Union Life has been completed in the name of “Himalayan Life Insurance Limited”. However, the companies are yet to start the joint integrated transaction.
On the other hand, though the merger agreement between Prabhu Life Insurance Limited and Mahalaxmi Life Insurance Company Limited finalized at the swap ratio of 1:1, the companies are yet to start the joint integrated transaction.
Surya Life and Jyoti Life Insurance Limited started integrated transaction in the name of “SuryaJyoti Life Insurance Company Limited”.
