Britam to acquire Real Insurance in a 60pc cash deal
Britam building situated at Upper Hill in Nairobi. The firm intends to purchase 99 per cent of Real Insurance. FILE
What you need to know:
40 per cent of the of the consideration will be satisfied by issuing shares
60 per cent will be satisfied using cash
Britam disclosed on November 22 its plans to acquire a 99 per cent stake in Real Insurance
Britam has disclosed that 40 per cent of the cost of acquiring Real Insurance will be met through issued shares.
Nancy Kiruki, company secretary in a public notice on Tuesday said that the financial services firm expects to close its acquisition of Real Insurance in the first half of 2014.
Although Nairobi Securities Exchange (NSE) listed firm did not disclose the full amount of the deal, it said that the remaining 60 per cent of the cost will be done through cash.
“Under the transaction forty per cent (40%) of the of the consideration is intended, subject to all requisite regulatory approvals, to be satisfied by an issue of shares in Britam to the shareholders of Real, while the balance of sixty per cent (60%) will be satisfied in cash,” said Ms Kiruki in the notice.
Britam, which has interests in insurance, real estate and asset management, disclosed on November 22 its plans to acquire a 99 per cent stake in Real Insurance through cash and share swap offer.
“The completion of this transaction is subject to customary closing conditions that include procurement of shareholders approvals as well as regulatory approvals from various regulators, which the Board expects will be concluded in the first half of 2014,” said Ms Kiruki.
Britam has a presence in South Sudan and Uganda, but it derives more than 90 per cent of its earnings from Kenya and plans to change this structure in the coming years as the subsidiaries mature.
The acquisition of Real Insurance will give the company a presence in Tanzania, Malawi and Mozambique.
In another acquisition in November, Britam took a 25 per cent stake in Acorn, a property development firm, which has been developing and managing properties for clients such as Coca-Cola East Africa, Deloitte East Africa and Equity Bank.
Britam’s net profit rose 28.7 per cent to Sh2.1 billion in the six months to June, helped by capital gains in its equity portfolio.
