Sanlam, Africa’s top insurer and partially owned by South African billionaire Patrice Motsepe, wants to purchase all issued ordinary shares of Pretoria-based insurer Assupol Holdings Limited (Assupol) for R6.5 billion ($344 million).
The transaction, which will be undertaken through a scheme of arrangement with a backup general offer to Assupol shareholders, will be completed by one of Sanlam’s wholly-owned subsidiaries, Sanlam Life Insurance Limited (Sanlam Life), subject to shareholder and regulatory clearance.
The proposed sale coincides with Sanlam’s recent announcement of its strategic orientation and worldwide ambitions amid South Africa’s economic challenges. Sanlam intends to integrate Assupol into its retail mass cluster, thereby strengthening its position in the South African financial services sector.
The integration is expected to result in a strong financial services offering that will complement Sanlam’s existing firms, which include Sanlam Sky, Safrican, and the Capitec Joint Venture. The strategic relocation is planned to be completed by the end of October 2024.
Sanlam, founded in 1918, has a market value of R156.96 billion ($8.3 billion) on the Johannesburg Stock Exchange and is partly controlled by Motsepe.
Motsepe, South Africa’s richest Black man with a net worth of $2.7 billion, maintains a 7.8 percent ownership in the insurance company through his investment vehicle, Ubuntu-Botho Investments, and serves as vice chairman.
In response to Sanlam’s decision to acquire Assupol, Sanlam Group CEO Paul Hanratty emphasized the strategic significance of the move, saying, “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 went on to say, “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.” Bongani Madikiza, CEO of Sanlam’s retail mass cluster, will be instrumental in facilitating Assupol’s integration into the Sanlam Group.
Assupol will keep its brand, identity, and independent management team, while Madikiza will coordinate multiple retail mass enterprises, encouraging collaboration and assuring the transfer of intellectual property and best practices to maximize Sanlam’s market position.