JSE-listed insurance giant Sanlam on Friday announced its firm intention to acquire all the outstanding ordinary shares of Pretoria-headquartered insurance company Aspor in a R6.5-billion deal.
Aspor, which is listed on the Cape Town Stock Exchange (CTSE), also confirmed the transaction in a statement.
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Sanlam Limited (Sanlam), a 110-year-old insurance company, through its wholly owned subsidiary Sanlam Life Insurance Limited (Sanlam Life), will acquire 100% stake in Aspol, pending shareholder and regulatory approvals. The company announced its intention to acquire the company for R6.5 billion.
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“This proposed transaction will be implemented by scheme of arrangement and follows Budvest Proprietary Limited’s announcement last year. [Budvest]holds 46.02% of Assupol's securities and International Finance Corporation. [IFC]”The company, which holds 19.41% of Assupol, plans to dispose of its respective holdings,” the company said.
Assupol pointed out that both institutions that sold group shares had been shareholders of Assupol for 10 years.
“Budvest and IFC have provided irrevocable commitments to vote in favor of all resolutions necessary to implement the scheme of the agreement.
“The decision to hire a new potential investor, Mr. Sanlam, was made after careful consideration and extensive evaluation of the potential benefits for all parties involved by the Aspor board,” it added.
new chapter
Dr. Reuel Khoza, Chairman of Assupol, said: “This acquisition by Sanlam not only strengthens Assupol's position in the market, but also strengthens our ability to continue to deliver excellent value to our customers. We are excited about this new chapter. We look forward to the benefits it will bring to both our employees and customers.”
Mr Sanlam said in a JSE Sens statement on Friday's proposed transaction that Aspor intends to sell its respective interests in Aspor on the CTSE on April 3, 2023, with “significant shareholder” Budvest and “significant minority shareholder” IFC. He emphasized that he had announced the announcement. .
“Following the successful completion of the sale process, holders of Aspol common stock… are pleased to announce that Aspol and Sanlam, through its wholly-owned subsidiary Sanlam Life Insurance Co., have entered into an implementation agreement effective February 1, 2024. ” the paper said.
“Sanlam believes that Assupol is a strong strategic fit within the Sanlam Group and can strengthen and contribute to Sanlam’s existing scale in the retail mass-market sector.
“This market segment is a strategic priority for Sanlam and is receiving significant focus and support to ensure continued strong growth.”Additionally, Aspol’s strong customer base in Gauteng is a key driver of this competitive It can strengthen our strategic position in the hotly contested state,” Sanlam added.
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Assupol Life began in 1913 as a burial society for South African Police Force personnel.
“This strategic move will further strengthen both companies' positions in the market and strengthen their ability to offer comprehensive insurance solutions to their respective customers,” Aspol said.
“There are no anticipated changes to the operations of either company as a result of Sanlam’s proposal.
“Aspol's well-known and trusted brand and reputation, which insures more than four million people in South Africa, will be maintained and further promoted,” he added.
“Sanlam and Aspor share similar values around socio-economic transformation and ethical behavior, and we are excited that our partnership will have a positive impact on the South African market and the lives of our customers.” the statement said.
Assupol's board constituted an independent board in accordance with article 108 of the Takeover Regulations, taking into account the terms of Sanlam's offer.
“The independent board of directors has resolved to recommend this proposal to the ordinary shareholders of Assupol and the holders of “B” shares in Assupol. Implementation of the Scheme of Agreement is subject to the fulfillment or waiver, as the case may be, of Assupol shareholders, CTSE, the Takeover Regulation Authority, competition authorities and all other relevant conditions precedent by 31 January 2025. . This type of transaction is not authorized.”
Aspor's market capitalization on the CTSE was approximately R4.94 billion as of February 1, 2024.
“At 30 June 2023, the date of Assupol’s last audited annual financial statements, the Assupol Group had a net asset value of R5.39 billion, a reserve value of R7.07 billion and a profit after tax of R5.3 billion. It was R90 million, and for that period it was R716.26 million,” Sanlam said in a statement to Sens.
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