President Emmerson Mnangagwa has sailed through the impact of Covid-19 and Russia’s invasion of Ukraine. With several months away from Zimbabwe’s ... general election where he will be seeking another term, Mnangagwa is facing a bigger challenge that could further cripple the Zimbabwean ailing economy: a power crisis.
Discreetly addressed to the attention of investors, the cautionary announcement of Sanlam, the pan-African leader in insurance, testifies to the vitality of the sector until the last hours of the calendar year. The announcement even caught many of the analysts, whom we consulted, off guard.
“Sanlam and Allianz SE are currently studying various strategic alternatives with regard to their respective African activities (excluding South Africa),” says the South African-based insurer, which entered into discussions with the German holding company, a global insurance heavyweight ($158bn in turnover globally and nearly $793m in gross written premiums in Africa – excluding South Africa, for 2020) on 22 December.
Rationalisation of portfolios
The precise scope of these preliminary discussions is not known for now, for regulatory reasons – the two groups are both listed on the stock exchange. However, these ‘alternatives’ could include a global strategic partnership, as well as a number of separate agreements for specific areas.
In any case, the group has reassured clients – at least internally – that these options do not mean that Allianz intends to leave Africa. This comes barely two years after the German insurer sold five of its African subsidiaries in the CIMA zone (Benin, Burkina Faso, Mali, Togo and Central Africa) to the Sunu Group – to which the Congo subsidiary was added this year.
The idea is to restructure our respective portfolios.
The African branch of Allianz, headed since 1 November by Delphine Traoré, also took control of its joint venture with Jubilee Holdings, which is Kenya’s leading insurer in East Africa.
Saham, NSIA, Allianz… a succession of operations
“The idea is to restructure our respective portfolios,” says Sanlam, and like Allianz, the pan-African group – which recorded a turnover of $19bn in 2020 – confirms its ambitions to consolidate its activities in order to be among the top three insurers in the countries it operates in.
The group, which indeed boosted its geographical footprint on the continent by getting its hands on the Saham Group in 2018, is finalising its integration. It also recently completed a double cross-transaction with the Ivorian leader in the sector Nouvelle société interafricaine d’assurance (NSIA), which is owned by Jean Kacou Diagou.
This latest transaction comprises the transfer, to Sanlam, of its life and non-life subsidiaries (non-life insurance) in Mali. Sanlam in turn handed over two life subsidiaries (in Togo and Gabon) and two non-life insurance companies (Guinea and Congo) to NSIA.
Morocco, Senegal, Cameroon
Ultimately, with the negotiations underway between Allianz and Sanlam, the stakes are high in three countries: Morocco, Senegal and Cameroon, where, if the deal is confirmed, it will propel the duo to the rank of national leader.
Allianz is present in 12 countries in Africa (Morocco, Kenya, Nigeria, Ghana, Madagascar, Uganda, Senegal, Ivory Coast, Cameroon, Egypt, South Africa and Mauritius). Following its merger with Jubilee Holdings, the group now has two subsidiaries in Kenya and is still awaiting approval for the acquisition of two additional subsidiaries in Burundi and Tanzania.
As for Sanlam, the group operates in 31 countries. The Johannesburg group is thus present in almost all the countries where Allianz has established itself, except Egypt, which is not managed operationally by Allianz Africa.
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