Britam Holdings Plc has opted to sell its shares held in Equity Group Holdings Plc, even as it looks to stabilise.
According to a public statement by company secretary Winnie Jumba, Britam is looking to offload 158,540,750 shares, constituting an equity stake of approximately 4.201 percent. The shares are worth Ksh7.7 billion, as per the share price of Ksh48.50 as of Friday, December 14, 2021.
On 24 December 2021, Britam and Britam Life Assurance Company (Kenya) Limited entered into a share purchase and sale agreement with International Finance Corporation (IFC) and IFC Financial Institutions Growth Fund, LP (IFC FIG Fund), where IFC and IFC FIG Fund agreed to acquire the shares by way of a private transaction.
IFC is a sister organisation of the World Bank and a member of the World Bank Group and is the largest global development institution focused exclusively on the private sector in developing countries. IFC FIG Fund is a limited partnership established under the laws of the United Kingdom and managed by IFC Asset Management Company, a division of IFC that invests alongside IFC in high potential companies and infrastructure projects across Latin America and the Caribbean, Africa, the Middle East, Eastern Europe and Asia.
“The Proposed Transaction is subject to conditions that are customary to transactions of this nature, including but not limited to obtaining regulatory approval from the Capital Markets Authority and other relevant regulators. Pending completion of the Proposed Transaction, the shareholders of Britam and other investors are advised to exercise caution when dealing in the shares of Britam on the Nairobi Securities Exchange,” said Jumba.
Britam has been riddled with loss-making in the recent past, posting a record loss of Ksh9.1 billion for the year ended December 31, 2020.
The regional insurer took a hit from losses in its investment portfolio. It booked fair value losses of Ksh2.3 billion from falling stock market valuations and Ksh2 billion from property impairments.
In the six months to June 2021, Britam Group posted a Ksh376.3 million net profit.
In March, Britam axed at least 130 employees in a cost-cutting move meant to result in a more competitive, efficient and customer-centric organization.
However, in November 2021, Britam CEO Tavaziva Madzinga’s resignation was confirmed, less than a year after the Zimbabwean national joined the firm. This dealt a blow to the firm, which was banking on the expertise of the Zimbabwean to turn things around.
Madzinga is leaving Britam to take up a new position at the head of South African insurer Santam.
At Britam, he had taken over from Benson Wairegi – a seasoned executive who’d spent 40 years at Britam.
Madzinga spearheaded a restructuring of the company that included eliminating several senior managerial positions. From 19 managers when he joined, Britam currently has 11 managers.
Britam has interests in insurance, real estate, asset management and banking. The firm has a presence in Kenya, Uganda, Tanzania, Rwanda, South Sudan, Mozambique and Malawi.