Sanlam to acquire parts of Alexander Forbes
Cape Town - Sanlam, Africa’s largest non-banking financial services group, today announced that it has reached an agreement to buy the group risk and retail life business of Alexander Forbes Life Limited (AF Life).
The Group said in a statement that the proposed transaction will support its South African growth strategy by strengthening its position in the group risk and retail life insurance markets. The group risk and retail life books of AF Life reported R1 billion in combined gross written premium for the year ended March 2021. The transaction will add approximately 210,000 members to the group risk business, and 3,700 policies to the Sanlam’s retail life business.
Sanlam Group CEO Paul Hanratty said, “Sanlam’s strategy aims to deepen client relationships and better client experiences while offering a compelling and differentiated employee value proposition. We look forward to welcoming the AF Life clients and employees to Sanlam. This transaction supports our strategy of building a fortress position in South Africa and will diversify Sanlam’s pool of life insurance risks.”
Dawie de Villiers, Chief Executive Officer of Alexander Forbes, says, “We are pleased with the Proposed Transaction, in the context of the current operating environment. This disposal is the final step in our move away from providing insurance underwriting and reaffirms Alexander Forbes' strength as a trusted adviser to our clients. The Proposed Transaction not only benefits Alexander Forbes, through the realisation of value for shareholders, but also balances solutions for clients and protects and values the employees of the Business.
“Sanlam understands the importance of delivering financial well-being and I am confident that the clients and employees moving across in this process are in good hands. We will continue to play a key role to the valued clients of AF Life delivering best advice throughout the transition and into the future.”
The sale and transfer of the AF Life policies will be for a total cash consideration of R100 million (subject to adjustment), paid in instalments. Sanlam will fund the transaction from existing cash resources. The effective date for the transaction will depend on Sanlam and AF Life fulfilling certain conditions, including regulatory approvals.