68% of GTAssure Sold for N12.3bn to Assur Africa Holdings

Assur Africa Holdings (AAH), a consortium of international investors, yesterday took over 67.68 percent (majority) shareholding of Guaranty Trust Assurance plc (GTAssur) from Guaranty Trust Bank plc (GTBank) in a transaction valued at about US$76 million.

The take over follows what the participants in the deal described as a transparent bidding process over the last one year.

Segun Agbaje, GTBank Chief Executive Officer, said all the parties involved were pleased to welcome Assur Africa Holding to Nigeria and wish them all the best as they assume ownership of the controlling stake in GTAssur.

“As one of the largest transactions by volume and value to be executed in compliance with the CBN directive on divestment of non-banking subsidiaries, we are privileged to have been able to contribute to the foreign direct investment drive of the Federal Government of Nigeria.”

AAH is made up of six members, comprising three international Developmental Finance Institutions (DFIs) – DEG ( Germany ), Proparco (France) and FMO ( Netherlands) and three Private Equity Funds with substantial investments across Africa.

Though based in the Netherlands, FMO’s area of operation is international with partners and clients from all over the globe, contributing to the development of the private sector in Africa, Asia, Eastern Europe and Latin America .

On the other hand, DEG a member of KfWBankengruppe (KfW Banking Group), is one of the largest European Development Finance Institutions for long-term project and company financing.
Created in 1977, PROPARCO is a Development Financial Institution partly held by Agence Française de Dévelopement (AFD) and private shareholders from the North and South of France.

AfricInvest-Tuninvest Group is one of the leading private equity firms in North and sub-Saharan Africa with over $550 million of assets under management across 10 Private Equity funds sponsored by prestigious DFIs, private and institutional investors. DPI is a fund advisory business founded in 2007, to make private equity investments in Africa . DPI combines a value investing orientation with a disciplined investment style, uncovering unique and exclusive investment opportunities in rapid growth economies and sectors in Africa .

Top officials of the member firms of Assur Africa Holding including Nanno Kleiterp (CEO, FMO), Runa Alam (CEO, DPI) and Ziad Oueslati (Director, AfricInvest Capital Partners) say they are delighted and very excited about the acquisition.

“We have immense ambition for GTAssur and are now looking forward to the next stage of GTAssur’s development and harnessing the growth prospects in the Nigerian insurance sector and beyond,” they said in a joint statement issued shortly after the take over agreement was signed.

GT Assur Chief Client Officer, Tosin Runsewe, said having built a solid foundation under the ownership and tutelage of GTBank, one of the most successful financial services institutions in Nigeria , GTAssur is now set for the next level of growth and consolidation.
“We eagerly anticipate further tremendous growth opportunities under the majority ownership of AAH, which is a group of international investors with such impeccable standing and rich pedigree,” He added.

Over the years, GTAssur has developed a competitive advantage in the provision of professional and ethical underwriting services to leading institutions in the private and public sectors of the economy.
Specifically, GTAssur is a leading underwriter to companies in the Oil & Gas, Telecommunications, Manufacturing, Financial Services and Commodity Trading Industries, as well as various institutions in the public sector.

In addition, GTAssur has pioneered and developed a unique brand of distribution of innovative retail insurance products through widespread banking channels, agency offices and recently, an on-line channel. In 2006, GTAssur introduced the 24-hour claims settlement process for motor accidents in Lagos, an innovation hitherto considered impracticable within the local environment.

In July 2011, Guaranty Trust Assurance plc published its half-year (H1) audited financials, recording a growth of 28 percent in its Gross Premium Income (GPI) and 40 percent in its Profit before Tax (PBT). GPI grew to N6.1 billion for H1 2011, compared to N4.8 billion for the same period in 2010. PBT rose to N713.6 million, compared to N511.2 million in the corresponding period in 2010.

Having also achieved a combined ratio of 84%, GTAssur continues to record positive ratios along its key financial indicators. Net Premium Earned and Underwriting Profit grew by 27 percent and 31percent respectively. Net claims incurred grew slightly by 8 percent while operating expenses remained relatively flat, rising by 6 percent.

Source – www.businessdayonline.com/NG/index.php/news/76-hot-topic/29122-new-investors-buy-68-of-gtassure-for-n123bn

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