AXA enters the Nigerian market
2 December 2014
Read by 3521 persons
Axa, a global leader in insurance, is strengthening its African presence by acquiring 77% of Mansard Insurance, Nigeria's fourth-largest insurer, for €198 million. This deal comes just days after the arrival of Moroccan company Saham in this highly sought-after market.
In a press release issued on November 28, Axa announced its arrival in the Nigerian market. The world leader in insurance, until now active in six countries on the continent *, acquired 77% of Mansard Insurance. The seller, a consortium called Assur Africa Holdings (including AfricInvest and Development Partners International), will receive €198 million upon completion of the transaction.
Axa specifies that "Mansard is the 4th insurer in Nigeria, operating in both property and casualty insurance (number 4 with 5% market share) and life, savings, and retirement (number 5 with 4% market share)". In 2013, the company achieved a turnover of €64.3 million, after experiencing an average annual growth of 22% since 2010. Its net income amounted to €9.9 million, three times more than in 2010.
Assur Africa Holdings acquired the Nigerian insurer at the end of 2011 from GT Bank (for, according to our sources, around €60 million), changing its name from GT Assur to Mansard Insurance a few months later.
Third largest market
"This acquisition represents a unique opportunity to establish ourselves in Africa's leading economy, with strong positions across all business lines and exposure to the rapidly growing Nigerian personal insurance market. Axa will benefit locally from the expertise of an experienced management team and a profitable platform," commented Denis Duverne, Deputy Chief Executive Officer of Axa, in a press release. Consequently, this transaction marks a new step in our acceleration strategy, which is at the heart of our Ambition Axa plan. It is in line with our belief that insurance is essential to promote economic development by providing communities with its expertise in risk protection and management."
The Nigerian insurance market is the third largest in Africa, after Morocco and South Africa, with $1.86 billion in premiums in 2013, according to Swiss Re. Its potential is very significant: the most populous country in Africa has an average premium of $11 per inhabitant, far from the levels reached in Kenya ($35/inhabitant), Morocco ($97), Mauritius ($552) or South Africa ($1025). The penetration rate (0.6% of GDP according to Swiss Re) is very low.
Investors
Many international insurers are also positioning themselves in the country. A week ago, the pan-African group based in Morocco, Saham, acquired 40% of the Nigerian non-life insurance company Unitrust Insurance. In 2013, South African companies Sanlam (in association with local banking giant First Bank) and Old Mutual established themselves there. In 2011, Ivorian company NSIA acquired 96.15% of Adic Insurance's capital.
With this transaction, Axa once again underlines its growing interest in Africa. After several years of waiting, the French group is once again on the offensive on the continent. In December 2011, it made its first steps in Algeria. Recently, as revealed by Jeune Afrique, it approached Saham to study a possible stake in this group, which is the number one on the continent in terms of geographical coverage. Last September, it signed a partnership with the IFC (World Bank Group) to co-invest in emerging markets, particularly in Africa.
* Algeria, Cameroon, Ivory Coast, Gabon, Morocco, Senegal
Jeuneafrique.com
Article published on December 2, 2014
In a press release issued on November 28, Axa announced its arrival in the Nigerian market. The world leader in insurance, until now active in six countries on the continent *, acquired 77% of Mansard Insurance. The seller, a consortium called Assur Africa Holdings (including AfricInvest and Development Partners International), will receive €198 million upon completion of the transaction.
Axa specifies that "Mansard is the 4th insurer in Nigeria, operating in both property and casualty insurance (number 4 with 5% market share) and life, savings, and retirement (number 5 with 4% market share)". In 2013, the company achieved a turnover of €64.3 million, after experiencing an average annual growth of 22% since 2010. Its net income amounted to €9.9 million, three times more than in 2010.
Assur Africa Holdings acquired the Nigerian insurer at the end of 2011 from GT Bank (for, according to our sources, around €60 million), changing its name from GT Assur to Mansard Insurance a few months later.
Third largest market
"This acquisition represents a unique opportunity to establish ourselves in Africa's leading economy, with strong positions across all business lines and exposure to the rapidly growing Nigerian personal insurance market. Axa will benefit locally from the expertise of an experienced management team and a profitable platform," commented Denis Duverne, Deputy Chief Executive Officer of Axa, in a press release. Consequently, this transaction marks a new step in our acceleration strategy, which is at the heart of our Ambition Axa plan. It is in line with our belief that insurance is essential to promote economic development by providing communities with its expertise in risk protection and management."
The Nigerian insurance market is the third largest in Africa, after Morocco and South Africa, with $1.86 billion in premiums in 2013, according to Swiss Re. Its potential is very significant: the most populous country in Africa has an average premium of $11 per inhabitant, far from the levels reached in Kenya ($35/inhabitant), Morocco ($97), Mauritius ($552) or South Africa ($1025). The penetration rate (0.6% of GDP according to Swiss Re) is very low.
Investors
Many international insurers are also positioning themselves in the country. A week ago, the pan-African group based in Morocco, Saham, acquired 40% of the Nigerian non-life insurance company Unitrust Insurance. In 2013, South African companies Sanlam (in association with local banking giant First Bank) and Old Mutual established themselves there. In 2011, Ivorian company NSIA acquired 96.15% of Adic Insurance's capital.
With this transaction, Axa once again underlines its growing interest in Africa. After several years of waiting, the French group is once again on the offensive on the continent. In December 2011, it made its first steps in Algeria. Recently, as revealed by Jeune Afrique, it approached Saham to study a possible stake in this group, which is the number one on the continent in terms of geographical coverage. Last September, it signed a partnership with the IFC (World Bank Group) to co-invest in emerging markets, particularly in Africa.
* Algeria, Cameroon, Ivory Coast, Gabon, Morocco, Senegal
Jeuneafrique.com
Article published on December 2, 2014
