Johannesburg – Today Sanlam and Santam confirmed that all conditions precedent have been met, including all the necessary regulatory approvals, to increase their effective stake in Morocco-based SAHAM Finances S.A. (SAHAM Finances) by a further 16.6% to 46.6% for US$329m plus transaction costs, effective 10 May 2017.
The insurers said the transaction has been funded from internal cash resources. It said the introduction of gearing to fund a portion of the acquisition consideration will be considered in due course as part of the Group's continual capital management programme.
Sanlam and its short-term insurance subsidiary, Santam, first acquired a 30% effective stake in SAHAM Finances in February 2016 with Sanlam Emerging Markets holding 75% and Santam 25% thereof. Following the acquisition of a further 16.6% stake in SAHAM Finances, Sanlam Emerging Markets will hold 85% and Santam 15% of the total investment in SAHAM Finances.
SAHAM Finances is an insurance group with operations in 26 countries across North, West and East Africa as well as in the Middle East. It is one of the largest insurers in Africa, and the market leader in most of the countries in which it operates. The insurer writes mainly non-life business (exceeding 80% of its portfolio) through its 63 subsidiaries. It has a network of 700 branches with a staff complement of more than 3 000 people.
Mr Junior Ngulube, Chief Executive Officer of Sanlam Emerging Markets says the latest transaction confirms the Sanlam Group’s commitment towards strengthening the strategic partnership further.
“Having identified strong synergies between the Sanlam and SAHAM Groups, we are committed to unlocking additional collaborations together through our collective skills and network capabilities across Africa. We believe this holds significant mutual benefits for the two groups and it will also benefit our stakeholders,” concludes Ngulube.