Insurance group Britam Holdings says it could sell all or part of its stake in mortgage financier HF Group within one year as part of its strategy to reduce its exposure to the stock market.
The process of divesting from the Nairobi Securities Exchange-listed firm, which intends to transform into mainstream banking, started last year. Britam holds a 48.2 percent stake in HF which it classifies as an associate.
“The directors approved the appointment of a transaction advisor to engage various interested parties with a viable option expected to be realised within the next twelve months,” the insurer says in its latest annual report.
“Options under consideration include reaching out to strategic partners with the requisite capacity to fast track and support the process of turning around HF Group and support the Britam Group to realise optimal value from the investment.”
Britam, which has written off a substantial part of the investment it made in HF, says it acquired the stake as a means of expanding in the real estate and mortgage industry.
The insurer has, however, adopted a new strategy aimed at reducing earnings volatility that it says has primarily come from cycles in the stock market and real estate sector.
“A key component of the new strategy is to minimise investment earnings volatility to a level where these do not impact the Group’s overall financial performance,” Britam said.