Sanlam has announced that it has acquired the remaining stake in the Nigerian insurance business FBN Insurance from its partner, FBN Holdings Plc (FBNH)

South African Insurance group Sanlam, becomes the only shareholder in the Nigerian life insurance company, First Bank of Nigeria (FBN) Insurance and its subsidiary FBN General Insurance.

The acquisition follows a deal signed between FBN Holding (parent company of FBN Insurance and FBN General Insurance) and Sanlam which grants the South African company the ownership over the 65% stake held by FBN Holding in the two branches.

Before the agreement was signed, Sanlam held 35% in FBN Insurance. The transaction, conducted through Sanlam’s business cluster focused on emerging markets, Sanlam Emerging Markets (SEM), has received all the necessary regulatory approvals.

This confers the ownership of FBN Insurance (Life) and its subsidiary, FBN General Insurance Limited, on Sanlam.

The deal, which was sealed via a Share Purchase Agreement (SPA), took effect from June 1.

SEM’s Chief Executive Officer, Mr. 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.

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"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.

"This transaction is evidence of our belief and confidence in the value and future of the business as well as the skilled management team and staff.

"Moreover, we are committed to Nigeria and view it as a key market on the continent. The African continent as a whole remains important and integral part of Sanlam’s growth."

Commenting on the divestment, UK Eke, MFR, Group Managing Director, FBN Holdings Plc said ‘’ The divestment is in line with the Group’s medium to long term strategic objectives. This will ultimately improve our shareholders’ wellbeing and deliver greater value to all the stakeholders”.

FBN Insurance was started as a JV between Sanlam and FBN Holdings as a life insurer in 2011 and after a successful growth trajectory, expanded into general insurance by establishing FBN General Insurance in 2015.

Concluding, Me Werth said; “FBN is a well-established, 120-year-old company with an impeccable reputation in the Nigerian market and the financial services industry as a whole.

"Over the years we have enjoyed a mutually beneficial partnership with FBNH, and we will continue to cooperate with them in the future. FBNI has grown into a significant insurance player in the market with a strong management team and we look forward to continuing to deliver excellent financial services and value to our clients and stakeholders."

Let’s note that FBN Holdings started the process of selling its shares in the capital of FBN Insurance since April 2020. The operation is in line with the development strategy of the Nigerian group. The financial details of this sale have not been disclosed.

The divestment, however, has no impact on FBN Insurance Brokers Limited as it remains a subsidiary of FBN Holdings.