KATHMANDU, July 14: Sagarmatha Insurance Company (SIC) and Lumbini General Insurance Company (LGIC) on Thursday signed a memorandum of understanding for merger.
SIC board member Lokmanya Golchha and LGIC board member Arun Raj Shrestha inked the agreement for the unification. SIC and LGIC have agreed to maintain a swap ratio at 100:80. LGIC Chairman Manohar Das Mool will hold the position of chairman while current Chief Executive Officer of SIC Chunky Chhetry will work as the CEO of the merged entity.
SIC and LGIC ink agreement to finalize merger deal
Giving a deadline of mid-April 2023, the Insurance Board has been pushing the insurers to either increase their capital base or go into a merger if they fail to do so. According to the regulator, the life insurance companies will have to increase their paid-up capital to Rs 5 billion from the existing Rs 2 billion. Similarly, non-life insurers will have to raise their capital to Rs 2.50 billion from Rs 1 billion.
As of now, Everest Insurance Company and Himalayan General Insurance Company have started a process for merger. Similarly, Prime Life, Union Life and Gurans Life have already signed agreements for merger.
