Japanese insurer Tokio Marine has agreed to acquire a 22.5% stake in South African peers Hollard Holdings and Hollard International in a cash deal worth around ZAR5bn ($328m).

Hollard Holdings operates in South Africa, while Hollard International has presence in Namibia, Botswana, Mozambique, Ghana, Lesotho, and Zambia.

As at 30 June 2017, Hollard Holdings’ paid up capital was JPY12.8bn ($115.4m) and Hollard International’s paid up capital was JPY3.5bn ($31.5m). The two South African firms offer both life as well as non-life insurance services.

The latest deal builds on the Japanese insurer’s existing partnership with Hollard.

Commenting on the deal, Tokio Marine said: “The insurance market in Sub-Saharan African Countries is expected to significantly grow and therefore contribute to geographical diversification in the medium and long term; however, given Tokio Marine’s limited presence and experience in the local market, we see it more prudent to explore the market through partnership with a local player rather than greenfield investment or 100% acquisition.

“Through the transaction, Tokio Marine will be able to acquire a precious foothold in full-scale expansion to Sub-Saharan African market.”

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData

The transaction is expected to close in the end of this year or early next year, subject to regulatory nod. The deal will be financed using Tokio Marine’s existing liquidity.