Sanlam Emerging Markets, a unit of South African insurance company Sanlam Ltd., said it’s buying 51 percent of Malaysia’s MCIS Zurich Insurance Berhad for about 1.25 billion rand ($118.4 million).
Sanlam will first buy a 40 percent stake in MCIS Zurich from shareholder Koperasi MCIS Berhad and then make an offer to acquire 11 percent from minority investors, the Cape Town-based company said in a statement today. Should there be a lack of interest in the offer from minorities, Sanlam will go back to Koperasi to make up the difference, it said.
Sanlam is pursuing growth opportunities in emerging market regions including South East Asia and bought a 49 percent stake in Malaysia’s Pacific & Orient Insurance Co. Berhad in 2012. Sanlam Emerging Markets also operates in India and 15 African countries where economic growth rates outstrip those of developed nations.
“Malaysia is a key part of Sanlam’s future growth strategy and the acquisition of a majority shareholding in MCIS Zurich will entrench our presence,” Sanlam Emerging Markets Chief Executive Officer Heinie Werth said in the statement.
MCIS Zurich has 2800 agents selling life insurance, 600 general agents and 26 branches in Malaysia, according to Sanlam. It will seek to sell its general insurance business as Malaysian law doesn’t allow a company to operate in the industry under more than one license, Sanlam said.