JS Company is going to make an investment of up to Rs. 1 billion in its associated company EFU General Insurance to expand and strengthen its roots in the financial sector.
According to a stock filing, the management of JS Company has given a green signal to make long-term equity investments in EFU Insurance Ltd. from time to time, by means of purchasing ordinary shares of insurers.
The decision was taken at the annual general meeting of the shareholders through a special resolution. The shareholders authorized the top brass of the bank including CEO, CFO, and secretary to take all financial decisions and measures in this connection.
According to a company official, investment in an associated company is a strategic move for the bank to expand avenues of investment to lucrative and growing businesses, especially in insurance companies (life and general).
The insurance sector, including EFU General Insurance and EFU Life Assurance, is expected to grow further not only through investment but with a strategic partnership as well as using channels and branches of the associated bank, he added.
Earlier in 2017, the board of directors planned to make an investment of Rs. 675 million in EFU General Insurance and EFU Life Insurance with the acquisition of ordinary shares (489 million and 190.6 million)
The investment plan was retained this year too and it could be carried out by the company by 2019.