The Hollard Insurance Group, South Africa’s largest independent insurance group, together with its umbrella holding company, has agreed to acquire the Regent Group (comprising Regent Life and Regent Insurance) from Imperial Holdings, in a deal which values the Regent Group at around R2,3 billion. Subsequent to the acquisition, some of Regent’s motor-related businesses will be sold to the Hollard/FirstRand motor Value-Added insurance Products (VAPS) joint venture.
The deal, which follows an extensive due diligence, is still subject to regulatory approval. The detailed legal agreements will be completed in due course, following which regulatory approvals will be sought.
The Regent business consists of long and short term licences in South Africa, Botswana and Lesotho, and covers motor-related insurance as well as a number of non-motor areas. In its financial year to 30th June 2015, the Regent Group reported gross premium income of R2,9 billion and profit after tax of R319 million.
Speaking after the release of the SENS announcement, Nic Kohler, CEO of Hollard, said: “Today marks an important milestone in what we believe to be a tremendously exciting transaction for Regent and for us and our partners at FirstRand. Over the last two months of the due diligence process, we have been able to verify our view of the synergies between Hollard and Regent in the life, commercial and personal lines areas. In addition, the process has showcased the strongly positive Regent culture and high levels of professionalism in the business. We think the Regent business is a strong strategic fit and are confident the deal will be value-enhancing for all parties. We are particularly excited about entering into a long-term partnership with the Imperial Group as a consequence of this transaction.”
Mark Lamberti, Imperial CEO said, “The sale of Regent underlines Imperial’s intent to focus on its two major lines of mobility, namely logistics and vehicles. Financial services related to our substantial vehicle distribution capability and retail footprint will remain an important part of Imperial and we are confident that the relationship with Hollard will facilitate the growth of this business. We are equally confident that the potential of those parts of Regent unrelated to vehicles will best be realised under Hollard’s ownership.”