Old Mutual to buy Oceanic General Insurance

Chuks Udo Okonta and Agency report

Old Mutual Plc, South Africa-based Insurance firm, hopes to bed down the purchase of Oceanic’s general insurance business by the end of the first half of this year, Inspen has learnt.

According to a foreign media, the underwritinf firm has upped its commitment to the rest of Africa by deploying R5bn for expansion over the next three to five years. The Johannesburg-and London-listed insurer is on the verge of acquiring a short-term insurance business in Nigeria.

"It hopes to bed down the purchase of Oceanic’s general insurance business by the end of the first half of this year, a deal that will put the group in a position to offer life and non-life solutions in a country that is underinsured." it was learnt.

Competition among South African financial services companies in West Africa is expected to intensify. Liberty wants to bed down an acquisition in Ghana and Nigeria by the end of the year.

The short-term insurance business that Old Mutual is looking to acquire in Nigeria is a sister company of Oceanic Life, which it recently acquired from Ecobank.

Old Mutual South Africa and Emerging Markets CEO Ralph Mupita said there were great opportunities for short-term insurance in Nigeria as non-life gross written premiums exceeded those of life.

In Ghana, the company was considering options, but nothing was on the radar yet, he said.

Old Mutual has life and asset management businesses in Namibia, Zimbabwe, Kenya and Malawi. It also has a life business in Swaziland.

Mupita said his division would consider value-accretive opportunities in Southern Africa, especially in countries where Old Mutual did not have a presence. In South Africa, the plan is to drive efficiencies in the existing businesses.

The insurer is expecting iWyze, the short-term insurance business of its subsidiary, Mutual and Federal, to break even by 2015.