Share Trading of Prabhu Insurance Company Limited (PRIN) & Premier Insurance Company Nepal (PIC) has been Resumed

Nepal Stock Exchange (NEPSE) has issued a circular stating that the trading of securities for the Prabhu Insurance Company Limited (PRIN) and Premier Insurance Company Nepal (PIC) has opened to the general public, except for Basic shareholders of both companies.

Siddhartha Insurance Company and Premier Insurance Company Nepal had inked a merger agreement in a share swap ratio of 1:1. Whereas, Ajod Insurance (AIL) and PRIN had opted for a merger route to enhance their capital.

The trading of shares was halted for both PRIN and PIC from July 15 and July 11 respectively. From Sunday, Mangsir 18, the share trading of both companies will resume on NEPSE. 

After being compelled to merge by the regulatory body, the Insurance Board (Beema Samiti), in order to raise their paid-up capital, many non-life insurance businesses decided to merge with each other.

The Fiscal Act 2078/79 also exempts the insurance firm from paying capital gains tax, dividend tax, and employee retirement tax if the preliminary merger agreement is completed by the end of the fiscal year. In order to take advantage of this, insurance companies executed a merger agreement before the deadline of the facility.

Non-life insurance companies have been urged by the Insurance Board to raise the paid-up capital to Rs 2.5 Arba. Following the Insurance Board's judgment, the insurance companies have combined several strategies, including pursuing a merger, to meet that standard. Last fiscal year, there were a total of twenty non-life insurance companies, after the merger of ten non-life insurance companies, the non-life insurance companies will come down to fifteen.