A fresh shareholder dispute has emerged at Cannon Insurance, with the family of the late businessman Inderjit Talwar accusing South African firm Metropolitan International Holdings PTY and other parties of illegally transferring shares without their consent.
At the heart of the legal battle is a contested Ksh 350 million deal, which Talwar’s widow Nirmalla and son Vishisht claim was not honoured, leading to an alleged forceful takeover of the insurance company.
The dispute revolves around Cannon General Insurance (K) Ltd and Cannon Life Assurance (K) Ltd, where the late Talwar’s estate holds a 25% stake.
According to court filings, Metropolitan International had agreed to acquire these shares for Ksh 313 million and Ksh 37 million respectively before May 31 2022 as part of a broader shareholder restructuring plan.
However, Talwar’s family now claims that despite the expiration of the agreed timeframe, the shares in Cannon Life Assurance were transferred without their approval.
The alleged irregular transaction has prompted legal action against Metropolitan, Cannon General Insurance, Cannon Life Assurance, Goodison Twenty Five Ltd, Gareto Investment Trust Ltd, lawyer Desterio Oyatsi and Golum Investment.
The Registrar of Companies has also been named in the suit, with Talwar’s family seeking an injunction to prevent any further transfer of shares particularly those valued at Ksh 313 million under the 2021 agreement.
Metropolitan International first entered the Kenyan insurance market in 2014 by purchasing a 75% stake in Cannon Insurance in a transaction valued at approximately Ksh 2.3 billion.
Following this acquisition, it retained a 66.29% controlling interest, while a small portion of shares was ceded to Goodison Twenty Five and Gareto Investment Trust.
Talwar’s family maintained its 25% stake, which later became the subject of negotiations that Metropolitan and its partners allegedly failed to honour.
The late businessman’s widow and son argue that the share transfer was executed in violation of Cannon Life Assurance’s Articles of Association, which require both the seller and buyer to sign transfer documents.
They maintain that no such authorisation was given and that the move was orchestrated to push Vishisht Talwar out of the company’s board of directors.
Further, they claim that the Insurance Regulatory Authority (IRA) had set conditions for the transaction, including compliance with section 23 (4A) of the Insurance Act, which limits any single entity’s ownership in an insurance firm to 25%.
The IRA had also directed that any proceeds from the transaction be held in an escrow account pending the fulfilment of all conditions.
Talwar’s family now argues that these conditions were ignored and the transaction proceeded without adherence to regulatory approvals.
In their suit, the Talwars are demanding the revocation of the 2022 share transfer and full payment of the Ksh 350 million owed for their shares.
Additionally, they are seeking compensation for damages, arguing that the transaction was unlawful and should be declared null and void.
Metropolitan and the other respondents have yet to respond to the lawsuit, while the court battle over the contested stake in Cannon Insurance now unfolds.
