Sanlam makes R6.5bn offer for Assupol
Century-old insurer
Sanlam is valued at about R158 billion on the JSE and it is eyeing 50 million customers across Africa by 2025.
Africa's largest insurance group, Sanlam, announced on Friday that it's made a R6.5 billion buyout offer for life insurer Assupol, intending to add it to its already-hefty life and savings portfolio.
Assupol was founded in 1913 as a burial society for members of what was then the South African Police. The company has grown into a fully-fledged life insurer, with a slogan of "serving those who serve," but it offers insurance and savings products to anyone.
It had an embedded value of R7 billion as of its year to end-June 2023, while at the end of that period, Sanlam reported a group embedded value of R61 billion for its covered business.
It is listed on the Cape Town Stock Exchange, where it is valued at about R4.9 billion, while Sanlam is valued at about R158 billion on the JSE and it is eyeing 50 million customers across Africa by 2025.
The offer price represents a 32.17% premium to Assupol's shares.
Stronger
"This acquisition by Sanlam will not only strengthen Assupol's position in the market but also enhances our ability to continue providing exceptional value to our clients," chair Reuel Khoza said in a statement.
Sanlam said the acquisition would result in an enhanced product offering, including through the ability to capitalise on the businesses' respective routes to market and leveraging cross-selling opportunities.
"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," Sanlam group CEO Paul Hanratty said.
"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," he added. "Given the envisaged synergies, we are confident it will deliver accretive value for all our stakeholders." – Fin24
Assupol was founded in 1913 as a burial society for members of what was then the South African Police. The company has grown into a fully-fledged life insurer, with a slogan of "serving those who serve," but it offers insurance and savings products to anyone.
It had an embedded value of R7 billion as of its year to end-June 2023, while at the end of that period, Sanlam reported a group embedded value of R61 billion for its covered business.
It is listed on the Cape Town Stock Exchange, where it is valued at about R4.9 billion, while Sanlam is valued at about R158 billion on the JSE and it is eyeing 50 million customers across Africa by 2025.
The offer price represents a 32.17% premium to Assupol's shares.
Stronger
"This acquisition by Sanlam will not only strengthen Assupol's position in the market but also enhances our ability to continue providing exceptional value to our clients," chair Reuel Khoza said in a statement.
Sanlam said the acquisition would result in an enhanced product offering, including through the ability to capitalise on the businesses' respective routes to market and leveraging cross-selling opportunities.
"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," Sanlam group CEO Paul Hanratty said.
"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," he added. "Given the envisaged synergies, we are confident it will deliver accretive value for all our stakeholders." – Fin24
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