Jubilee to get US$2.3m from Mauritius unit stake sale

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The sale of a 54.15 per cent ownership in Jubilee Holdings’ Mauritian subsidiary to insurance industry titan Allianz SE is likely to be finalised within the next month.

At this point, Jubilee Holdings would be entitled to a payment of US$2.3 million (KShs. 270 million).

  • Jubilee Holdings will get Sh270 million from the sale of its Mauritian subsidiary to Allianz SE next month
  • Upon completing the Mauritius sale, Jubilee will have collected a total of Sh7.75 billion. Allianz would also invest Sh3 billion as the biggest stakeholder in the businesses
  • Allianz is set to  acquire a 66 per cent stake in Jubilee Insurance Company of Mauritius Limited

Allianz will buy additional shares from Aga Khan Fund for Economic Development SA (AKFED), which will then sell its ownership of 11.85 per cent of Jubilee Insurance Company of Mauritius Limited to it. This will allow Allianz to acquire a total stake in the company equal to 66 per cent.

“We anticipate completing the Mauritius acquisition in September. The total consideration for Jubilee is Sh270 million,” said Nizar Juma, chairman of Jubilee Holdings, a Nairobi Securities Exchange-listed company.

The insurance company presently has 88.15 per cent of the shares in the Mauritian subsidiary, but after the completion of the sale, it will only own 34 per cent of the business.

The transaction is the final one of a series of partial divestitures in Jubilee’s general insurance companies, which include those in Kenya, Tanzania, Uganda, and Burundi. These partial divestitures have been completed.

The company initiated the procedure of selling stakes ranging from 51 per cent to 66 per cent in the business’s general insurance subsidiaries in the various markets to Allianz for a total of 10.8 billion Kenyan shillings in 2020.

When everything is said and done about the Mauritius transaction, Jubilee would have been paid a grand total of 7.75 billion shillings. Additionally, Allianz will invest a total of 3 billion shillings in the respective businesses in which it holds the majority shareholding.

As a result of the deals, Jubilee has realised large gains, which have contributed to the rise of its profits.

Investment income and higher net premiums contributed to Jubilee’s increased net profit of Sh6.8 billion for the year that ended in December, which was up 67% from the previous year.

As a result of the performance, the company has declared an extraordinary dividend of Sh5 for each share. In addition to its regular dividend of Sh9 per share, the company distributed this amount.

After reaching an agreement to purchase a majority stake in Jubilee’s general insurance businesses, Allianz negotiated a contract with Sanlam Limited of South Africa to establish a joint venture. This agreement may have repercussions for the Kenya-based subsidiaries of both of the aforementioned companies.

Allianz is now the controlling stakeholder of Sanlam Kenya and the majority owner of Jubilee Allianz General Insurance Kenya, a company listed on the Johannesburg Stock Exchange.

The international companies’ interests in their operations across many markets, including Kenya, would be brought together under the auspices of the 10-year joint venture.

BRIEF HISTORY

Locally incorporated in 1997, Jubilee Insurance (Mauritius Ltd) is a subsidiary of Jubilee Holdings Ltd (JHL), which is the largest insurance business in East Africa. Jubilee Insurance (Mauritius Ltd) was named after the country of Mauritius.

In a short time, Jubilee Insurance has established itself as one of Mauritius’s top five insurance providers. The company is known for its dependability, rapid claims settlement, excellent client service, and competitive and pioneering product offerings.

The Jubilees Insurance brand provides the Mauritian market with various products that fall under the short-term insurance category. This encompasses goods in the areas of Asset insurance, Liability insurance, and Health Insurance.

Jubilee Insurance (Mauritius) Ltd currently runs operations out of three locations on the island. These locations include Port-Louis (which serves as the company’s Head Office), Quatre-Bornes, and Beau-Bassin.

Read: Insurance giants Allianz, Sanlam sign US$2.1 billion merger

Maingi Gichuku is passionate about helping African businesses grow by offering technology solutions. With a BSC in Zoology and biochemistry, Gichuku yearns for an Africa that can find solutions to its challenges. My drive is to see an economically dynamic Africa and embrace its populations by creating opportunities cutting across the social and economic strata.

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