South Africa-based Sanlam, along with its short-term insurance subsidiary Santam, has entered into an agreement to purchase 30% stake in Morocco-based Saham Finances insurance business, for around $375m.
Sanlam and Santam will acquire 30% share capital in Saham Finances from The Abraaj Group, World Bank Group member International Finance Corporation (IFC), and IFC African Latin American and Caribbean Fund (IFC ALAC Fund), which is managed by IFC Asset Management.
The Saham Group already has 62.5% interest in Saham Finances, which operates in around 26 countries across Africa and the Middle East.
Sanlam Group chief executive Ian Kirk said: "This partnership with Saham Finances will provide the Sanlam Group with a significant competitive advantage as no other insurance company can offer the same regional network to the professional and corporate market."
According to Sanlam, the deal is subject to regulatory approvals and the acquisition by the Saham Group of the remaining 7.5% stake held by Abraaj, IFC and the IFC ALAC Fund in Saham Finances.
Once the deal concludes, Sanlam Emerging Markets (SEM) will own 75% and Santam 25% of the stake through a special purpose vehicle in Saham Finances. The deal is expected to complete in the first quarter of 2016.
The acquisition will allow Sanlam Group to enter into new markets such as Cote d’Ivoire, Gabon, Senegal and Cameroon in West Africa, Morocco and Lebanon in the Middle East and Angola in Southern Africa.
Saham Finances, which mostly operates non-life business, has a network of around 650 branches with more than 3,000 employees. It generates a consolidated turnover of about $1bn per annum.
The company operates in the insurance, assistance and health administration sectors, providing services to the private individuals, professionals and companies. It has recently made several acquisitions in Nigeria, Kenya, Rwanda and Angola.
Image: Sanlam and its insurance subsidiary Santam to acquire 30% stake in Morocco-based Saham Finances insurance business. Photo: courtesy of stockimages / FreeDigitalPhotos.net.