JOHANNESBURG - Assupol Life's plan to demutualise has been approved by the North Gauteng High Court, paving way for the insurer to place about 400m shares worth R500m and also putting the firm a step closer to a listing on the Johannesburg Securities Exchange.
The 97-year-old insurer , which caters for the lower to middle income groups in South Africa,announced its plans to demutualise early in October. Before the demutualisation Assupol had to substantiate to the court that its policyholders were widely consulted on the process and what it meant for policyholders.
Demutualisation occurs when a mutual life insurance company, such as Assupol, which does not have external shareholders, becomes a proprietary company. It offers free shares to its policyholders and lists.
The North Gauteng High Court ruling sets in motion the restructuring of the group into a holding Company (Assupol Holdings Limited) and two operating businesses namely Assupol Life Limited and Assupol Investments (Pty) Limited.
"Today is not only a milestone in the history of Assupol but also a significant step towards its future. The hard work of the Assupol Life team and its advisers, Webber Wentzel Attorneys, during the last few months has finally paid off," CEO Rudi Schmidt said.
"Besides the allocation of free shares to qualifying policyholders of Assupol Life, the demutualisation scheme also provides for the creation of a community trust which will uplift and support the communities where large concentrations of Assupol policyholders reside".
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