Guardrisk has been sold to MMI Holdings. The transaction follows expressions of interest received from several potential investors.
Chief executive of Alexander Forbes, Edward Kieswetter, said the sale is an important step towards further aligning the business with the company’s intent to target the growth sectors of retail, the public sector and sub-Saharan Africa by leveraging off its existing institutional client base.
The conclusion of the transaction is subject to regulatory approvals by South Africa's Financial Services Board and the competition authorities.
MMI, a financial services group listed in Johannesburg, is the successful bidder from a list of several investors who expressed an interest in Guardrisk, a wholly owned subsidiary of Alexander Forbes.
Guardrisk is a cell captive insurer based in South Africa. In May Kieswetter described it as “a gem of a business.”
The sale followed a review by Alexander Forbes into its businesses, with the aim of focusing on growing its core employee benefit‚ asset management and insurance operations.
Herman Schoeman, Guardrisk managing director, who will continue to lead the company along with his current management team, said: “We have been a leader in the specialised insurance industry since our inception and we look forward to unlocking synergies and providing value enhancing products and services to our current and future clients.”
The purchase price of 1.6 billion rand will be funded from MMI’s capital buffer, which the company says will remain healthy to fund other strategic growth initiatives.
