Companies

Jubilee stakes deal with Allianz to close in June

JUBILEEALLIANZ

Allianz Africa regional CEO Coenraad Vrolijk (left) and Jubilee Holdings Chairman Nizar Juma during the announcement of the agreement to establish a strategic partnership on September 29, 2020, at Jubilee Centre in Nairobi. PHOTO | SALATON NJAU | NMG

Jubilee Holdings #ticker:JUB expects to complete the sale of majority stakes in its regional general insurance subsidiaries to Allianz SE by the end of June.

The insurer will receive about Sh7.75 billion in the transaction while Sh3 billion will be invested in the operating businesses in Kenya, Uganda, Tanzania, Burundi and Mauritius, bringing the total consideration to Sh10.8 billion.

The company has classified the stakes in the subsidiaries, ranging from 51 per cent to 66 per cent, as available for sale in its financial statements for the year ended December.

“We expect to complete all the transactions by the end of June,” Jubilee’s chairman Nizar Juma told the Business Daily, adding that some of the markets such as Kenya will finish their deals as early as the first week of May.

The transactions were initially scheduled to be completed in the first quarter ended March.

Mr Juma said the company intends to use the proceeds to make new investments besides fortifying the capital base of its life and medical business.

“Our goal is to operate with more than adequate capital in our insurance business,” Mr Juma said.

Jubilee has not decided whether it will also pay a special dividend following the completion of the deal with Allianz.

The firm has, however, maintained its normal dividend payout for the year ended December when its net earnings rose nearly two per cent to Sh4.08 billion.