San­lam is now largest in­surer in Africa

Deal gives the group a larger foot­print

Pretoria News - - Front Page - BANELE GININDZA

SAN­LAM yes­ter­day be­came the largest in­surer across the African con­ti­nent fol­low­ing its $1.05 bil­lion (R15.37bn) splurge on Sa­ham af­ter reg­u­la­tors au­tho­rised the pur­chase of more shares in the Mo­roc­can in­sur­ance group.

San­lam said the deal gives it ac­cess to 26 more coun­tries on the con­tine­nent, in ad­di­tion to the seven coun­tries in which it al­ready op­er­ates.

“The African pres­ence of the com­bined group is un­par­al­leled in the in­dus­try,” said San­lam emerg­ing mar­kets chief ex­ec­u­tive Ju­nior Ngu­lube.

“With ex­per­tise across life, gen­eral and spe­cial­ist in­sur­ance and in­vest­ment man­age­ment in Africa, we now have sig­nif­i­cant op­por­tu­ni­ties for cross-sell­ing and di­ver­si­fi­ca­tion.” Sa­ham has op­er­a­tions across North, West and East Africa, as well as in the Mid­dle East.

San­lam’s ac­qui­si­tion of the re­main­ing stock an­nounced in March, brings its to­tal in­vest­ment in the com­pany to al­most $1.7bn since Fe­bru­ary 2016.

The trans­ac­tion would see San­lam tak­ing own­er­ship of 90 per­cent of Sa­ham Fi­nances with the prop­erty and ca­su­alty in­surer, San­tam, hold­ing the bal­ance.

San­lam said cur­rent Sa­ham chief ex­ec­u­tive Na­dia Fet­tah and deputy Em­manuel Brule would re­tain their po­si­tions and join the San­lam emerg­ing mar­kets ex­ec­u­tive com­mit­tee.

San­lam group chief ex­ec­u­tive Ian Kirk said the con­clu­sion of the trans­ac­tion was a big step in the strat­egy to ex­tend the com­pany’s foot­print in the con­ti­nent. “The con­flu­ence of the com­bined foot­print and re­spec­tive ex­per­tise of San­lam, San­tam and Sa­ham Fi­nances pro­vides the San­lam Group with an op­por­tu­nity to grow its Life In­sur­ance busi­nesses in Fran­co­phone mar­kets as well as lev­er­ag­ing the group’s ex­per­tise to grow the gen­eral in­sur­ance port­fo­lio,” Kirk said. “We are uniquely po­si­tioned to be the go-to fi­nan­cial ser­vices part­ner for multi­na­tion­als do­ing busi­ness on the con­ti­nent.

San­lam and Sa­ham only had joint ex­po­sure in Botswana, Kenya, Nige­ria and Rwanda.

Sa­ham Fi­nances, the Casablanca-based arm of the Sa­ham Group founded by Moulay Hafid Elalamy in 1995, is the largest in­surer on the con­ti­nent out­side of South Africa.

The com­pany owns 58.48 per­cent of Sa­ham As­sur­ance Morocco, which is listed on the Casablanca Stock Ex­change. San­lam first ac­quired a joint 30 per­cent stake in Sa­ham Fi­nances in Fe­bru­ary 2016 and a fur­ther 16.6 per­cent in May 2017.

At the end of last year, Sa­ham had con­sol­i­dated net as­sets worth $850 mil­lion and $77.4m in earn­ings.

But some an­a­lysts have raised ques­tions about San­lam’s ca­pac­ity to over­see such a large num­ber of busi­nesses.

“The deal would make most share­hold­ers a lit­tle un­com­fort­able”, said Av­ior Cap­i­tal Mar­kets’ War­wick Bam.

San­lam shares de­clined 3.73 per­cent yes­ter­day to close at R71.04.

SAN­LAM is now Africa’s largest in­surer af­ter snap­ping up Sa­ham in Morocco for about R15bn. | / DAVID RITCHIE African News Agency (ANA)

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