Himalayan General & Everest Insurance Merger Agreement
The insurance committee has made arrangements to increase the capital to Rs 5 billion for life insurers and Rs 2.5 billion for non-life insurers.
KATHMANDU: MAY. 6 – Himalayan General Insurance Company Limited and Everest Insurance Company Limited have reached an agreement to merge.
On Thursday, the two companies signed a merger agreement with a 1:1 share swap ratio. This is the first agreement between the two insurance companies.
Even before this, there was talk of insurance companies merging, but an agreement could not be reached. The insurance committee’s capital enhancement scheme is the primary reason for the merger of these two companies.
The insurance committee has made arrangements to increase the capital to Rs 5 billion for life insurers and Rs 2.5 billion for non-life insurers. The committee has given one year time to raise the capital. At present, the paid-up capital of life insurance companies is Rs 2 billion and that of non-life insurance companies is only Rs 1 billion.
Even after the merger, the capital of these companies will reach only Rs 2.42 billion. At present, the paid-up capital of Himalayan General is Rs 1.17 billion and that of Everest Insurance is Rs 1.25 billion.
The profit of the current financial year will reach the capital specified by the Insurance Committee after giving bonus shares.
After the decision of the Insurance Committee to increase the capital, other companies have also started discussing the merger.
