Kenya: Old Mutual Completes Faulu Acquisition

Apr 2014
Kenya, April, 01 2014 - Life insurer, Old Mutual, says it has completed the deal to acquire a majority stake in Kenya’s financial services firm, Faulu Microfinance Bank.

Julian Roberts, the CEO at Old Mutual Group, said the deal had been unconditional and said this signalled the official start of his firm’s relationship with Faulu.

“We look forward to seeing the results of this mutually beneficial relationship,” Roberts said.

Old Mutual is also currently trying to find more “suitable targets” to acquire in other parts of the African continent, it said late last year.

It said the incorporation of Old Mutual and its subsidiary short term insurer, Mutual & Federal (M&F), in the rest of Africa is currently being executed.

Ralph Mupita, CEO of Old Mutual Emerging Markets, said at the time that the acquisition of Faulu would give Old Mutual access and exposure to over 400 000 Faulu clients.

At the time the deal was announced, Mupita said the acquisition permitted Old Mutual a smooth entry into the East Africa mass market.

Old Mutual said the money used to buy the stake in Faulu would come from the R5 billion ($471,4m in today’s exchange rate) the firm recently said is earmarked for acquisitions in Africa.

Faulu is the first deposit-taking microfinance firm to be given the go ahead to operate in Kenya by the Central Bank of Kenya (CBK).

The microfinance bank has a distribution network that spreads across Kenya with over 100 branches. Its market is equal to the one that is served by Old Mutual’s Mass Foundation business in South Africa.

Old Mutual provides life assurance, asset management, banking and property & casualty insurance to more than 16 million customers in Africa, the Americas, Asia and Europe.

Originating in South Africa in 1845, Old Mutual has been listed on the London and Johannesburg Stock Exchanges since 1999.

Source : Ventures Africa

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