Linkage Assurance rights issue opened this week. A rights issue is when a company sells shares to existing investors. Here is a review, and why i think it is worth taking up.

Details of the rights issue

The firm is offering 12,320,000,000 shares each at N1.32 per Share on the basis of 2 new shares for every 3 shares held as at the close of business on Thursday January 22, 2026.

The offer opened on the 11th of March, 2026 and will close on the 23rd of April, 2026.

What will the proceeds be used for? 

The bulk of it will go towards acquiring a life insurance licence, and topping up capital for the existing business which is in the non life category.

Is this rights issue (and the stock) worth it? 

In a nutshell, yes.

. It is at a discount  of 15.38% to the current price  of N1.56 and at a discount to what the book value per share should be by end of FY 2026 which is N1.57.

 

Is the stock worth holding?

From a return on asset (ROA) and return on equity (ROE) perspective, the company’s numbers are a bit soft. 

The biggest compelling factors for holding this stock are its trading below book value its stake in Stanbic Pensions, and a few key quality shareholders.

At the moment, the stock is currently trading at 0.6 times book value. So it is fairly cheap. I don’t see any reason why it shouldn’t be trading at book value.  Post the rights issue that should reprice.

The biggest asset of this firm is its stake in Stanbic Pensions which it values at N24.8 billion. That stake is worth more imo. If you work the numbers, it probaly should be worth twice. Stanbic Pensins has an AUM of over N1 trillion.