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After all suspensive conditions were met, Sanlam Investment Holdings (SIH), an investment holding company backed by Southern Africa’s richest Black billionaire Patrice Motsepe, has officially merged with Absa Financial Group’s third-party investment management business.
Absa, one of Africa’s largest diversified financial services groups, will exchange its investment management business, Absa Investments, which includes Absa Asset Management, Absa Alternative Asset Management, Absa Fund Managers, and Absa Multi-Management, for a 17.5-percent stake in SIH under the terms of the transaction.
Sanlam Group is a pan-African financial services group that provides financial solutions across all market segments.
SIH is Sanlam’s third-party asset management company, in which Motsepe’s ARC Financial Services Investments Proprietary Limited (ARC) owns a stake. ARC owns a quarter of SIH, while Sanlam owns the remaining 75 percent of the asset management business.
More than a year ago, Sanlam and Absa signed a definitive agreement to merge their investment management businesses in South Africa, creating a behemoth with assets under management exceeding R1 trillion ($72.7 billion).
With implementation beginning today, Dec. 1, the transaction significantly strengthens SIH’s offering through increased scale, a broader distribution reach, and a more comprehensive range of investment solutions. It also strengthens SIH’s position as one of South Africa’s largest black-owned asset managers.
As part of the post-merger agreement between SIH and Absa’s investment management business, Absa has also entered into a 10-year distribution agreement with SIH, which means the expanded operations will use both Sanlam and Absa’s distribution networks, significantly broadening market reach for the enlarged entity under SIH.
Carl Roothman, CEO of Sanlam Investment Group, expressed his excitement that the agreement to integrate Sanlam and Absa’s investment management businesses has been completed and that the partnership will enable the delivery of investment solutions that sustain future generations while creating value for the businesses’ clients, who will benefit from the enhanced investment offering.
“Scale is critical in driving the product and service innovation required to meet clients’ financial goals,” Roothman added. He also stated that the combined capabilities, expertise, and commitment to clients will position SIH as the preferred investment solutions provider in South Africa.
