Prior to the deal, Sanlam had a stake of 35% in FBN Insurance, while FBN Holdings had a 65% stake
Sanlam takes full ownership of Nigerian insurer FBN Insurance. (Credit: Pete Linforth from Pixabay)
Sanlam has taken full ownership of its Nigerian insurance joint venture (JV) FBN Insurance by acquiring the remaining stake from its partner FBN Holdings (FBNH).
The deal has secured all the necessary regulatory approvals, said Sanlam, which did not reveal the financial terms.
Prior to the deal, the South Africa-based financial services group had a stake of 35%, while the Nigerian commercial bank FBN Holdings had a 65% stake in the insurance joint venture.
The deal was carried out through Sanlam Emerging Markets (SEM), the business cluster of the South African group, which is focused on emerging markets.
Sanlam Emerging Markets CEO Heinie Werth said: “This transaction is in line with our business strategy to deepen our presence in our existing markets and highlights and enhances our long-standing commitment to the Nigerian market.
“Sanlam exercised its pre-emptive right to acquire the remaining shareholding of FBNI and in line with our partnership philosophy that underpins our business model, we will introduce local shareholding at an appropriate time in the future.”
FBN Insurance has been in business for about a decade
FBN Insurance, which began operations in 2010, is a life insurance business that offers coverage for individual and corporate clients.
In 2014, the company acquired Oasis Insurance, a general insurance business, which has been renamed as FBN General Insurance, and now under 100% ownership of Sanlam.
According to FBN Holdings group managing director UK Eke, the bank’s sale of the stake in FBN Insurance is in line with its medium to long term strategic objectives. The transaction is expected to eventually improve the Nigerian group’s shareholders’ wellbeing and give them greater value for their shares.
Founded in 1918 as a life insurance firm, Sanlam is said to have become one of the largest non-banking financial services group in Africa via its diversification strategy. In March 2018, Sanlam signed a $1.05bn deal to acquire the remaining 53.37% stake in African investment company Saham Group’s insurance business.