ZIMBABWE Stock Exchange-listed concern NicozDiamond Insurance (NDI), is seeking investors in Uganda to recapitalise the group’s loss-making operation in the East African nation.
Report by Bernard Mpofu
Speaking at an analysts’ briefing in the capital on Tuesday NicozDiamond chief executive officer Grace Muradzikwa said the group was in talks with investors to shore up First Insurance Company (FICO) of Uganda amid indications that the group is not willing to let go the investment .
NDI, like many local companies that have spread their tentacles in the region, have found the going tough, but remains optimistic that an anticipated growth in Uganda’s economy on the back of oil and gas discoveries could grow the business.
As part of the group’s plans to widen the revenue, NDI also announced plans to diversify income streams by expanding into the region. Notwithstanding stiff competition in the region, Muradzikwa said indications are that the group may soon get regulatory approval from Mozambique authorities to start up business.
While the Uganda operation made an underwriting loss of $259 242 having suffered a bad claims cycle, Zimbabwe on the other hand made, an underwriting profit of $367 039. This resulted in an overall underwriting profit of $101 797.
“A lot of analysts have said you are so sentimental about FICO, why don’t get out of it? We have now taken a decision that we can invite a new investor, a local investor and we have gone a long way. In fact, we have identified three investors and we are willing to take a dilution so that we can bring in new investors who can help us to drive this particular investment. We think it’s a right investment provided we have the right linkages and the right shareholder needs towards the investment,” said Muradzikwa.
“We saw that happening in Zambia, the moment we brought in some good local partners we were able to turnaround the fortunes of that company. We expect that we should do the same at FICO.”
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The group’s gross written premium as at February 2013 rose to $7,4 million from $5,5 million recorded in the same comparative prior year. Investment income from quoted equities was up 1859% to $117 684 on the back of a strong performance of the ZSE at the start of the year.
The NDI boss also said the insurance company has plans to a cluster development projects in Hatfield in a bid to improve income.
