Fortis Insurance Proposes Debt-to-Equity Conversion For N5.74bn Bond

Fortis Global Insurance Plc has proposed a comprehensive debt restructuring plan that includes a potential debt-to-equity conversion as part of efforts to resolve its outstanding N5.74bn obligation under a long-standing bond arrangement.

The proposal is expected to be presented for shareholders’ consideration at the company’s Twenty-Eighth (28th) Annual General Meeting (AGM), where several special business resolutions will be tabled to provide the board with authority to execute the restructuring framework.

At the centre of the plan is the settlement of the company’s Daewoo Zero Coupon Bond, issued on 14 December 2009 and denominated at JPY 650,000,000.

The outstanding obligation, which stood at approximately N5.74bn as of 31 March 2026, is to be resolved through a combination of settlement mechanisms, including partial cash repayment, equity conversion, or other negotiated arrangements.

According to the proposed resolution, shareholders are being asked to approve the company’s authority to enter into binding settlement discussions with bondholders, including flexibility for the board to determine final commercial and legal terms in the best interest of the company.

The company is also seeking approval for a potential debt-to-equity conversion, which would allow all or part of the outstanding liability to be converted into shares.

This measure, if implemented, could strengthen the insurer’s balance sheet while reducing leverage and improving capital adequacy.

In addition, shareholders will consider a resolution to waive pre-emptive rights where necessary, enabling shares issued under the conversion arrangement to be allotted directly to the creditor without offering existing shareholders the first right of refusal.

The board is also requesting authority to adjust share capital and undertake all related corporate actions required to complete the transaction.

Further resolutions on the AGM agenda include granting the directors general authority to execute all necessary agreements, appoint professional advisers, and ratify prior steps already taken in relation to the restructuring process.

If approved, the restructuring framework would give the board broad discretion to finalise a settlement structure involving cash payments, equity issuance, or a hybrid arrangement aimed at resolving the long-standing debt obligation and reinforcing the company’s financial stability.

The outcome of the AGM is expected to be closely watched by stakeholders, as the proposed transaction represents a significant step in the company’s broader capital management and balance sheet optimisation strategy.