ACA, part of the South Africa financial services business Absa Group, provides employee benefits as well as consulting and administration to retirement funds in the South African retirement fund market.
It has a substantial book of standalone investment funds and 119 retirement funds with 339 active and 614 inactive members, with assets of approximately R84bn under administration.
Dawie de Villiers, chief executive of Sanlam Employee Benefits, said in a statement that the transaction will provide further scale in a market “where the opportunities to exponentially grow the administration and consulting parts of the business are limited”.
She added: “Scale is fundamentally important in the employee benefits industry to ensure a sustainable business model. In this regard the potential transaction positions us very well to further expand our product offering and service levels to clients and intermediaries.”
Marcel de Klerk, managing executive for Fiduciary Services at Absa Financial Services, said Sanlam Life will be capable of providing support where necessary due to its significant operations in both the private and umbrella fund markets as well as its credibility in the market place.”
The transaction is expected to be concluded by the end of 2017 following regulatory approvals.
Sanlam is a leading financial services group listed on the JSE Limited and the Namibian Stock Exchange. Established in 1918 as a life insurance company, the South Africa-based Sanlam Group has evolved into a diversified financial services business.
Absa Bank is a wholly owned subsidiary of Barclays Africa Group Limited, which is listed on the Johannesburg Stock Exchange and services primarily in South Africa and Namibia.
Barclays Africa is 23.4% owned by Barclays Bank and operates in 12 countries.
