MultiChoice to sell 60% stake in insurance business to Sanlam
TLDR
- South African insurer Sanlam to acquire 60% of MultiChoice's insurance business for 1.2 billion rand upfront, with a potential earn-out of up to 1.5 billion rand.
- MultiChoice aims for local and pan-African expansion, citing the need for increased resources, expertise, and technology.
- Earn-out payment dependent on total premium generated by the insurance business by December 31, 2026, with a pre-acquisition dividend of 59 million rand declared.
South African insurer Sanlam will buy a 60% stake in MultiChoice's insurance business for 1.2 billion rand ($66 million) in cash upfront and a potential performance-based earn-out of up to 1.5 billion rand.
MultiChoice, Africa's biggest pay-TV company, said that while its insurance business has demonstrated substantial growth in South Africa, its ambition to expand locally and across Africa "requires a step-up in resources, expertise and technology".
The potential cash earn-out payment is contingent upon the total gross written premium generated by the insurance business for the year ending December 31, 2026. A pre-acquisition dividend of 59 million rand will also be declared by MultiChoice's insurance business.
Points clés à retenir
MultiChoice will retain a 40% interest in the insurance business and 40% in the broader commercial venture with Sanlam. The deal allows Sanlam to further expand its insurance and financial services business across Africa, the companies said. Opportunities outside South Africa will be facilitated through its SanlamAllianz business. MultiChoice has a subscriber base of 21 million households across 50 African countries, while Sanlam operates in 31 countries, including eight of the top ten largest African economies.
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