Britam Group Managing Director Benson Wairegi said the approval will enable the diversification of business across several markets in the region, and lead to the expansion of their general business in Kenya/FILE
The shareholders ratified the decision by the board to acquire 14.85 million shares in Real Insurance in a share purchase agreement that will see Britam take over the management and assets of the company.
They also approved the allotment of up to 51.9 million new ordinary shares based on Sh11.13 per share in exchange of 40 percent of the purchase consideration.
Britam Group Managing Director Benson Wairegi said the approval will enable the diversification of business across several markets in the region, and lead to the expansion of their general business in Kenya.
He said the move will see Britam gain market share to become the largest Pan African insurance company within East and Central African Region.
Wairegi said that they intend to retain all staff from Real Insurance, including some of its board members and management, to support and help unlock value.
The deal has already received regulatory approvals from the Capital Markets Authority (CMA), The Insurance Regulatory Authority (IRA) and the Competition Authority of Kenya.
Real Insurance is considered a pioneer in the Kenyan insurance sector having started operations in 1910. It offers insurance services through its 15 branches located in Nairobi and other major towns in Kenya as well as three subsidiaries in Tanzania, Malawi and Mozambique.
The firm is also a global network partner of RSA (formerly known as Royal and Sun Alliance Insurance Group).
Through this acquisition, Britam should increase its market share and after completion, rank second in the market on gross premium basis.
Britam has already a strong presence in Kenya, and also has operations in Uganda, Rwanda and South Sudan.
The acquisition is also seen as a first step in the consolidation of the highly fragmented insurance industry with Kenya having 47 licensed insurance companies competing for a limited market characterised by low penetration.
“The satisfactory completion of this transaction will enable Britam to implement its strategy of expanding its general insurance business and diversifying its presence into key geographical areas that include some of the most promising growth frontier markets in Africa,” Wairegi said.
