RMB helps bolster Sanlam’s healthcare-related portfolio

MEDIA RELEASE

30 MAY 2023

RMB’s advisory service supports Sanlam’s acquisition of a controlling stake in AfroCentric

Sanlam has acquired a majority shareholding in AfroCentric Investment Corporation Limited (AfroCentric), a black-owned investment holding company with significant investment in the healthcare market, including the Medscheme medical scheme administration business and a pharmaceutical business.

Sanlam is the largest non-banking financial services group in Africa and a key client of RMB. This transaction will add strong healthcare capabilities to Sanlam’s already broad offering, which includes financial planning, investments, insurance, retirement, and wealth. The acquisition will bolster Sanlam’s healthcare-related portfolio with a controlling interest in the largest managed care provider in South Africa and the second-largest medical scheme administrator.

As transaction adviser and transaction sponsor to Sanlam, RMB played a key role in the transaction execution, helping Sanlam achieve the objective of expanding access to quality, reliable and affordable medical aid, and health insurance in South Africa.

The transaction structure was unique in the South African context, comprising of a partial offer with various discretionary acceptance bands allowing Sanlam flexibility within the parameters of the regulatory framework, while simultaneously affording AfroCentric shareholders an election between shares and cash, or a combination thereof, as settlement options. Furthermore, it required several regulatory approvals, including from the Takeover Regulation Panel, the JSE Limited and competition authorities across Southern Africa (including the South African Competition Tribunal).

“As one of the key transaction advisers to Sanlam, we worked closely with them to implement this unique solution that was aligned to their requirements. Our deep experience and innovative thinking helped to make the transaction a reality and deliver value to Sanlam,” says Karien Strydom, Head of Financial Institutions Group Advisory at RMB.

This deal will help Sanlam expand their overall healthcare value chain and enable the integration of Sanlam and AfroCentric services, to deliver a basket of healthcare solutions and consolidated product offerings. The mutually beneficial arrangement will also allow AfroCentric to expand its offerings to include products from the Sanlam portfolio and to access Sanlam’s extensive and well-established distribution network.

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