X

This is not a paywall.

Register for free to continue reading.

The news sucks. But your reading experience doesn't have to. Help us improve that for you by registering for free.



Please create a password or click to receive a login link.


Please enter your password or get a login link if you’ve forgotten


Open Sesame! Thanks for registering.

First Thing, Daily Maverick's flagship newsletter

Join the 230 000 South Africans who read First Thing newsletter.

We write for you

It’s a public service and we refuse to erect a paywall and force you to pay for truth. Instead, we ask (nicely and often) that those of you who can afford to, become a Maverick Insider and help with whatever you can. In order for truth not to become a thing of the past, we need to keep going.

Currently, 18,000 (or less than 0.3%) of our brave and generous readers are members; which says a lot about their characters and commitment to our country. These people are paying for a free service in order to keep it free for everyone.

They are the true South AfriCANs.(Sorry, we couldn’t help ourselves.)

Support Daily Maverick→
Payment options

Prudential Financial to acquire 14.8% minority stake in...

Business Maverick

ACQUISITION TRAIL

Prudential Financial to acquire minority stake in Alexander Forbes

(Photo: Victor J Blue / Bloomberg via Getty Images)

Prudential Financial, together with LeapFrog Investments, will acquire a 14.8% minority stake in the Alexander Forbes Group, further cementing the company’s long-term plan to access the financial services markets in Africa.

Since 2016, Prudential Financial and LeapFrog Investments have invested in high-quality financial services companies across the African continent, including the Enterprise Group in Ghana and Icea Lion in Kenya. 

“We are excited to broaden our presence in Africa and enter South Africa with this investment,” says Pavan Dhamija, Prudential Financial’s regional president. Prudential Financial intends to further increase its strategic minority ownership interest in Alexander Forbes through a partial offer to all shareholders such that its resulting shareholding will increase to 33%. The transaction is subject to regulatory approvals and other customary closing conditions. 

The deal will be structured such that Prudential Financial will acquire the strategic minority interest in Alexander Forbes from Mercer through its subsidiary New Veld, LLC. Prudential will own 99% of New Veld, LLC and LeapFrog the remaining 1%. LeapFrog Investments is acting as the investment manager to Prudential Financial, subject to approval by the Mauritius Financial Services Commission. 

Dhamija told Business Maverick that he is not able to comment on the cost or funding structure related to the acquisition of shares, save to say that there will be no impact on Alexander Forbes’ cash or net debt position. 

The deal is not expected to have any impact on the company’s BEE credentials. In terms of board changes, Simon O’Regan who currently represents Mercer on the board, will resign as a director with effect from the day following the completion of the transaction. Prudential Financial is entitled to nominate one non-executive director for as long as it holds at least 10% but less than 25% of the issued shares, or two non-executive directors for as long it holds 25% or more of the issued shares.

African Rainbow Capital (ARC), which has a 39.9% shareholding in Alexander Forbes, has the right to nominate one non-executive director to the board for so long as it owns at least 7% of Alexander Forbes. To better align the relationship agreements between the company’s two strategic shareholders, Alexander Forbes will also grant ARC the right to nominate one additional non-executive director for so long as it holds 25% or more of the issued shares. 

Gary Herbert, chief operating officer and partner at LeapFrog Investments, says the investment reinforces LeapFrog’s commitment to deepening access to financial tools to generate prosperity for consumers in emerging markets. 

Finally, Dawie de Villiers, chief executive of Alexander Forbes, says the transaction is an exciting development that will enable the company to leverage the global insights available through Prudential Financial to enhance its value proposition. BM/DM 

Gallery

Comments - share your knowledge and experience

Please note you must be a Maverick Insider to comment. Sign up here or sign in if you are already an Insider.

Everybody has an opinion but not everyone has the knowledge and the experience to contribute meaningfully to a discussion. That’s what we want from our members. Help us learn with your expertise and insights on articles that we publish. We encourage different, respectful viewpoints to further our understanding of the world. View our comments policy here.

No Comments, yet

Please peer review 3 community comments before your comment can be posted