United Group entrepreneurs have stepped into the non-banking finance and insurance sectors by purchasing shares of Duncan Brothers and its partners in United Finance and United Insurance for Tk 173.85 billion.

On November 10, United Group acquired 6.53 crore shares of United Finance for 89.75 crore, followed by 2.37 crore shares of United Insurance for 84.10 crore on November 11.

Both transactions were carried out through Duncan Brothers and its partners’ block market on the Dhaka Stock Exchange (DSE), according to the Dhaka stock exchange.

DSE data shows that United Group founders Hasan Mahmood Raja, Akhter Mahmud Rana and Khandaker Moinul Ahsan Shamim, along with their family members, purchased shares of United Finance at prices ranging from Tk13.70 to Tk14.30 each and shares of United Insurance at prices ranging from Tk35 to Tk35 each. 50 each.

In 1978, they founded United Group, which operates in a variety of sectors including energy, real estate, retail and services, healthcare, manufacturing, education, and ports, terminals and maritime. These entrepreneurs own United Power, which is traded on the stock exchanges.

Khandaker Moinul Ahsan Shamim, founder and director of United Group, told The Business Standard: “We are proud to join the legacy of trusted, sustainable financial institutions. In the current turbulent times, this move instills greater confidence.”

“This acquisition underlines our commitment to strengthening the economy. Investing in a challenging market reaffirms our confidence in the company’s potential and our commitment to the progress of the country,” he added.

On Monday, shares of United Finance closed at Tk 15.60, down 1.27% from the previous session. However, shares of United Insurance rose 4.57% to Tk 41.20.

The new owners of United Insurance purchased their shares at a 14 percent discount compared to the current market price, while United Finance purchased their shares at a 10 percent discount.

Duncan Brothers, a subsidiary of UK-based Camellia Group, and its partners, including Lawrie Group, hold 34.91% or 6.53 crore shares and 53.23% in United Finance, according to shareholding reports of United Finance and United Insurance. had it. or 2.36 crore shares in United Insurance.

At the end of October, UK-based conglomerate Duncan Brothers and its partners decided to divest their investments in United Insurance and United Finance by selling their shares in both companies.

According to documents reviewed by The Business Standard, share purchase agreements were signed with United Group entrepreneurs on October 30 following the decision.

According to the agreements, Ahsan Shamim, Akhter Mahmud, Nizamuddin Hasan Rashid, Sharfuddin Akhter Rashid and Khondakar Zahin Ahsan will hold managerial positions at United Insurance.

Meanwhile, Kayes Khalil Khan, Moinuddin Hasan Rashid, Mahenoor Sultana Rashid, Nazmul Hasan, Kutubuddin Akhter Rashid and Khondaker Zayed Ahsan will serve as directors of United Finance.

The business environment for insurance and NBFIs has deteriorated in recent years, an official from Duncan Brothers explained on condition of anonymity.

The official said that there is an oversupply of insurance companies and non-financial financial institutions in the country and public confidence in the sector has decreased due to various irregularities.

“As a result, Duncan Brothers has been trying to exit these industries for several years,” the official added.

Currently, there are 34 NBFIs and 46 non-life insurance companies in the country.

From Tea Heritage to Financial Sector Expansion

Duncan Brothers was founded 150 years ago, at a time when the tea industry was just beginning to develop. As a result, the company naturally shifted its focus to tea.

Over the next 150 years, Duncan Brothers experienced many changes, including changes in partnerships, ownership transitions, and mergers. It eventually became part of Lawrie Group PLC and later Camellia PLC.

The company diversified by founding United Insurance and United Finance in 1985.

General insurance company United Insurance reported a net profit of Tk 7.91 billion last year, paying 10% cash dividend to its shareholders. At the end of the first nine months of this year, its net profit was Tk 6.87 billion and earnings per share was Tk 1.55.

United Finance, on the other hand, paid a 6% cash dividend in 2023 and reported a net profit of Tk 14 billion for the year. Its total classified loan at the end of last year stood at Tk 98.59 billion, representing 4.80% of the total disbursement.

In January-September this year, United Finance reported a net profit of Tk4 crore with earnings per share of Tk0.22.