Sovereign Trust Insurance Approves N5 Billion Rights Issue

Sovereign Trust Insurance Plc has confirmed that its Board of Directors, chaired by Mr. Abimbola Oguntunde, has approved an initial capital raise of N5 billion through a Rights Issue. This marks the first stage of the company’s broader recapitalisation programme, designed to comply with the Nigerian Insurance Industry Reform Act (NIIRA), recently signed into law by President Bola Ahmed Tinubu.

The company explained in a filing on the Nigerian Exchange (NGX) that the Rights Issue represents a proactive step to strengthen its capital buffers and solvency position under the new regulatory framework. Segun Bankole, Head of Corporate Communications and Investor Relations, stated that the transaction is expected to be completed within the first quarter of 2026.

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Sovereign Trust has already begun structured engagements with issuing houses, legal advisers, and auditors, while awaiting regulatory approvals before formally opening the offer to shareholders. At its 30th Annual General Meeting held on September 25, 2025, shareholders endorsed a broader capital raise of up to N20 billion to reinforce the balance sheet, improve liquidity, and expand underwriting capacity. They also approved a dividend of 5 kobo per share, reflecting confidence in the company’s financial discipline.

The NGX responded positively, with Sovereign Trust’s shares ranking among the top gainers over several trading sessions in October 2025. Managing Director and Chief Executive Officer, Mr. Olaotan Soyinka, reaffirmed the company’s ambition to become one of Nigeria’s top five insurers. He emphasized that operational efficiency, premium growth, digital service delivery, and underwriting excellence remain the strategic pillars guiding the firm’s long‑term vision.

Earlier in September, the company had explained that the capital raise could be executed through a mix of share issuance options, including public offers, private placements, or rights issues, either locally or internationally, with pricing determined through book‑building or other valuation methods.