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Sanlam, Africa’s leading insurer, partially owned by South African billionaire Patrice Motsepe, has unveiled plans to acquire all the issued ordinary shares in Pretoria-based insurer Assupol Holdings Limited (Assupol) in a deal valued at R6.5 billion ($344 million).
The deal, set to be executed through a scheme of arrangement with a fallback general offer to Assupol shareholders, is to be completed by one of Sanlam’s wholly-owned subsidiaries, Sanlam Life Insurance Limited (Sanlam Life), pending shareholder and regulatory approval.
The proposed transaction follows Sanlam’s recent revelation of its strategic direction and global aspirations amid South Africa’s economic struggles. Sanlam aims to integrate Assupol into its retail mass cluster, further solidifying its footprint in the South African financial services landscape.
Sanlam’s strategic move set to transform the financial services landscape
The integration is anticipated to result in a robust financial services offering, complementing Sanlam’s existing entities, including Sanlam Sky, Safrican, and the Capitec Joint Venture. The conclusion of this strategic move is expected at the end of October 2024.
Sanlam, founded in 1918 and boasting a market capitalization of R156.96 billion ($8.3 billion) on the Johannesburg Stock Exchange, is partially owned by Motsepe.
Motsepe, South Africa’s richest Black man with a net worth of $2.7 billion, holds a 7.8-percent stake in the insurance giant through his investment vehicle, Ubuntu-Botho Investments, and serves as the vice chairman.
Assupol joins Sanlam: A strategic move towards market dominance
Commenting on Sanlam’s decision to acquire Assupol, Sanlam Group CEO Paul Hanratty emphasized the strategic importance of the move, stating, “The proposed acquisition will allow us to strengthen our fortress South Africa strategy and signifies Sanlam’s commitment to further long-term investment in South Africa.”
He added, “It places Sanlam in a strong competitive position in the retail mass segment of the South African market, thereby embedding our commitment to South Africa.” Sanlam’s retail mass cluster CEO, Bongani Madikiza, will play a pivotal role in supporting Assupol’s integration within the Sanlam Group.
Assupol is slated to retain its brand, identity, and separate management team while Madikiza will coordinate various retail mass businesses, fostering collaboration, and ensuring the sharing of intellectual property and best practices to maximize Sanlam’s market position.
