East African deal will drive emerging markets push

Allianz has moved to grow its footprint in Africa with a $100 million deal for the non-life operations of Jubilee Holdings Limited (JHL).

The German group have swooped to seal the deal with East Africa’s largest insurance group, with an agreement to establish a strategic partnership in the five African countries where Jubilee Insurance currently operates.

The partnership covers the general insurance business in Kenya, Tanzania and Uganda as well as the short-term insurance segment in Burundi and Mauritius. JHL will retain ownership of its Life and Pensions operations and its Medical insurance business in Kenya, Uganda and Tanzania.

Under the deal Allianz will acquire controlling stakes in each of these businesses for total consideration while JHL will retain a significant minority stake. JHL’s subsidiary in Kenya, Jubilee General Insurance Limited is the future joint venture company which will also acquire the business of Allianz Insurance Company of Kenya Limited.

The transaction, which will require regulatory approvals in the five markets as well as a restructuring of JHL’s subsidiaries in Uganda and Tanzania into separate general insurance units, will result in Allianz becoming co-shareholder alongside JHL in five general insurance subsidiaries of the JHL Group, holding between 51 percent and 66 percent in each company. On a preliminary pro-forma basis, these general insurance companies represent 12.3 percent of JHL’s total consolidated net assets of $299 million.

In a joint statement the two insurers say they aim to jointly expand and broaden insurance markets across East Africa, leveraging Jubilee Insurance’s deep regional knowledge, extensive networks and brand reputation with the global expertise and capacity of the Allianz Group.

“We are very pleased with this historic development for Jubilee Insurance,” said JHL Chairman Nizar Juma. “Over the past decade, we have been approached by a number of international insurers looking to partner with Jubilee to expand into East Africa. With Allianz, we have now identified a partner whose strategic aims are aligned to JHL’s and whose expertise in the general insurance business is able to enhance the range and depth of products and risk management solutions that we can offer to our customers.’’

“Allianz is a leading insurer and investor in key markets in the CIMA (Conférence Interafricaine des Marchés d’Assurance) zone and enjoys strong positioning in Morocco, Nigeria and Ghana. We are keen to enter these key East African markets with substantial market share at the outset and JHL is the best partner to help us achieve this ambition in East Africa,’’ said Coenraad Vrolijk, Regional CEO and Regional Executive Board Member of Allianz Africa. ‘’We believe this partnership will foster growth in these markets by delivering innovative solutions and superior quality service made possible by the combined expertise of both organizations.” Allianz brings 130 years of experience in insurance to this partnership as well as a long-standing presence on the African continent.”

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