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Kenyan businessmen Joe Wanjui and James Muguiyi have sold off a joint six-percent stake in the East African insurance holding company UAP Holdings to the South African financial services group Old Mutual Holdings for $29.6 million (Ksh3.2 billion).
Prior to the transaction, Wanjui held 43.25 million shares indirectly through his investment vehicle Bawan Limited. This is equivalent to a 20.4-percent stake in UAP. Muguiyi directly held 12.6 million shares, or a 5.9-percent stake.
According to Business Daily, the transaction, which raised Old Mutual’s stake in UAP from 60.7 to 66.7 percent, followed the company’s announcement in 2018 that it would buy 12.7 million ordinary shares in UAP from existing shareholders.
Information contained in UAP’s latest annual report revealed that Old Mutual began the purchases last year, while the final tranche was completed earlier this year.
The multinational acquired 2.8 million shares from Muguiyi in 2020 and purchased 9.8 million shares in UAP earlier this year.
The transaction amounts to $29.58 million (Ksh3.2 billion), reflecting the contractual discount adjusted and the movement in the Kenyan shilling to the rand over the period.
Commenting on the transaction, UAP CEO Arthur Oginga said Wanjui and Muguiyi have been paid. However, the share registration process was delayed and spilled over into 2020. He added that both men have retained minority positions in the insurer and did not sell an equal number of shares to Old Mutual.
In 2015, Old Mutual paid the late Kenyan tycoon Chris Kirubi, Centum Investment, Africinvest, Abraaj Group and Swedfund $188.85 million (Ksh20.4 billion) to acquire its initial 60.7-percent stake in UAP. At the time, the settlement represented a premium of more than 100 percent of the value of their shares based on the company’s book value.
The recent acquisition by Old Mutual underscores its commitment to increasing its market share on the local financial services market.
Wanjui, one of the most influential figures during the administration of former Kenyan President Mwai Kibaki, retired as the chairman of UAP on June 22 after serving on the company’s board for 35 years. Muguiyi served as the CEO of UAP from 1988 and 2012.
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