Following regulatory approval, Sanlam and Santam will acquire 30% of the share capital of Saham Finances for a purchase consideration of $375m (£247.4m, €352.9m). The deal is expected to close in the first quarter of 2016.
On completion, Sanlam Emerging Markets (SEM) will hold 75% and Santam 25% of the stake through a special purpose vehicle.
Expanded footprint
The transaction is set to expand Sanlam Group’s footprint across the African continent with entry into new markets; including Cote d’Ivoire, Gabon, Senegal, Cameroon, Morocco, Lebanon, and Angola.
Saham Finances is one of the largest insurers in Africa, writing mostly non-life business. It operates mainly in the insurance, assistance, and health administration sectors.
“We believe that Africa presents us with a unique, long-term growth opportunity.”
It has a network of over 650 branches, a staff complement of more than 3,000, and a consolidated turnover of over $1bn.
Ambitious acquisition strategy
Saham Finances has seen steady growth, particularly in Africa, as a result of its ambitious and deliberate acquisition strategy. To this end, the company has recently made several acquisitions in Nigeria, Kenya, Rwanda, and Angola, among others.
“We believe that Africa presents us with a unique, long-term growth opportunity,” said Sanlam Group chief executive Ian Kirk. “This partnership with Saham Finances will provide the Sanlam Group with a significant competitive advantage as no other insurance company can offer the same regional network to the professional and corporate market.
“This transaction, which is aligned to our diversification strategy, will enable us to access a diversified blend of new high-growth insurance markets in North and West Africa, which are largely underpenetrated.
“We are confident that the continent’s growing population, improved political landscape and the evolving financial markets and regulatory environment support our vision of being a leading Pan-African financial services company,” Kirk concluded.
