UK-based insurance company Prudential is set to acquire Kenya-based life insurer Shield Assurance, for an undisclosed sum.
Prudential intends to invest around Sh1.5bn ($16.9m) in Shield Assurance in the coming 12 months, which represents the second acquisition for the UK insurer in Africa.
Prudential Africa CEO Matt Lilley said the announcement is an important milestone for the company, which represents first step towards the creation of a new business in East Africa.
"We now look forward to working with our new colleagues at Shield to create one of Kenya’s leading life insurers, generating jobs and serving our customers," Lilley added.
Prudential is also planning to open an East Africa unit in Nairobi.
By 2020, the company plans to create 4,000 new jobs, which includes direct employees and self employed agents.
Kenya Insurance Regulatory Authority CEO Sammy Makove was quoted by Capitalfm as saying that Prudential will concentrate only on life insurance business in the country which has a current minimum capital requirement of Sh150m ($1.6m).
‘Life insurance penetration is at less than 1 percent. With the entrance of Prudential, we expect this to improve. We are hoping they will bring international standards of this business which will contribute growth to the sector," Makove added.
In December 2013, Prudential acquired a majority stake in Ghana-based Express Life Insurance, which is said to be the first acquisition in Africa.
Image: Prudential offices in King’s Road Reading. Photo: courtesy of Andrew Smith.