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Picture: REUTERS
Picture: REUTERS

Sanlam Life has agreed to acquire a 60% shareholding in MultiChoice’s insurance business, NMS Insurance Services, for R1.2bn.

In terms of the deal, the upfront cash consideration of R1.2bn also includes a potential performance-based cash earn-out, measured at end-December 2026, of up to a maximum consideration of R1.5bn.

The parties have also entered into a long-term commercial arrangement to expand insurance and related financial service offerings into MultiChoice’s subscriber base of 21-million households across 50 African countries.

NMS Insurance Services (NMSIS) is licensed to underwrite both non-life and life insurance products. It has been writing insurance for the past 20 years under the DStv brand of MultiChoice, focusing on device, installation, funeral, subscription waiver and debt waiver insurance products.
 
NMSIS, which formed part of MultiChoice’s fintech division, had demonstrated substantial growth and profitability in SA, but its plan to expand its product offering locally and geographic presence across Africa required a step-up in resources, expertise and technology, the company said.

Sanlam’s presence in Africa, coupled with its track record of success in insurance ventures with non-insurers, put it in a good position for a strategic venture with MultiChoice and NMSIS, MultiChoice said.

Through the strategic relationship, MultiChoice gains access to insurance expertise, comprehensive financial services resources and access to Sanlam’s financial services operations across Africa to address MultiChoice client needs.

The transaction enables MultiChoice to retain a 40% interest in NMSIS and 40% in the broader commercial venture with Sanlam, allowing it to continue benefiting from the high-growth potential of this segment while maximising value for its shareholders.

The transaction enabled Sanlam, through its Sanlam Fintech cluster, to advance its strategy of using technology to expand access to financial services across Africa.

MultiChoice’s subscriber base offers Sanlam a unique platform and attractive opportunity for cross-selling and cost-effective marketing to an actively engaged subscriber base.

It also affords Sanlam an opportunity to further scale its insurance and financial services offering across Africa. Opportunities outside SA will be facilitated through SanlamAllianz.

MultiChoice would use the proceeds from the transaction for working capital purposes.

mackenziej@arena.africa

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