South Africa-based insurance group Sanlam has revealed that its operations will be strengthened through the acquisition of Alexander Forbes and an additional 22.8-percent stake worth R2 billion in Saham Assurance Maroc.
The leading insurance group made the announcement in its interim results, stating that the proposed transactions will help the it strengthen its operations in South Africa and abroad.
The group revealed in the report that its South Africa operations will be boosted by the acquisition of the risk and retail life businesses of Alexander Forbes, a South Africa-based financial services group.
Meanwhile, the group’s operations outside South Africa will be strengthened through the acquisition of an additional 22.8-percent stake in Saham Assurance Maroc.
The transaction will allow Sanlam to deepen its direct presence in North and West Africa and explore broad partnerships in the long term.
The completion of the deal will set Sanlam on course to grow its stake in the Moroccan insurance company from 61.7 to 84.5 percent.
These transactions are in line with Sanlam’s continued strategy to accelerate growth on the continent, as it takes positions in core markets.
These strategic acquisitions are expected to boost the resilience of the group’s earnings, as challenging market conditions coupled with rising risk on insurance assets dampen overall growth potential.
Sanlam is majority-owned, indirectly, by South African billionaire Patrice Motsepe through Ubuntu-Botho Investments (UBI), an investment holding that he founded in 2004.
UBI is the direct beneficial holder of 292,471,806 ordinary shares in Sanlam, amounting to a 61-percent stake in the insurance group.
In its half-year financial statement, Sanlam recorded headline earnings of R4 billion ($281.5 million) in the first-half period of 2021, which ended on June 30. This is three-percent higher than its 2020 figures.
The group stated that it has R61.6 billion ($1.3 billion) in total cash, deposits and securities as of June 2020 This puts it in a comfortable position to acquire Alexander Forbes and Saham Assurance Maroc.
