This article was added by the user . TheWorldNews is not responsible for the content of the platform.

Aleyo buys 30% of FMRE shares

One of the most prominent reinsurance companies in Southern Africa, First Mutual Holdings Company (FMRE) has sold a 30% stake of the reinsurance business to Aleyo Capital Botswana.

The partnership deal code named Project Okavango worth P61 million was signed recently in Gaborone. Aleyo Capital is a Botswana based investment and asset management firm specializing in private equity and mezzanine investments in Southern Africa.

FMRE finances reinsurance business in 15 African countries.

Speaking at the launch, FMRE Managing Director Bongai Muhau said Botswana is one of the best performing and most consistent economies in Africa with a robust financial services regulatory framework.

He said it is at the centre of SADC which gives it central access to 400 million SADC population as a market bloc. Muhau said this partnership is meant to enhance their underwriting capacity, expand the business further into the region.

“First Mutual Holdings struck this deal as part of its balance sheet restructuring and capital raising exercise under which the financial services company has established a new subsidiary, First Mutual Reinsurance Holdings Limited (FMRHL), which will be domiciled in Botswana, to house its current two re-insurance businesses. It will result in one of the strongest and most competitive reinsurance businesses in Africa and will help the business expand its market presence to East and West Africa,” said Muhau

Muhau said their growth trajectory from 2010 started at P 50 000 000 and is currently sitting on P 250 000 000.

He said during that period, P280 million was paid in claims.

First Mutual Reinsurance Holding Group Chief Executive Officer, Douglas Hoto, said the two reinsurance businesses seek to enhance their underwriting capacities and improve their security profile through a series of transactions that will ultimately result in a competitive and adequately capitalised regional reinsurers with favourable profiles, poised for business growth.

He further said as part of its growth strategy FMHL is re-organising its business and intends to set up a Holding Company to consolidate its Botswana and Zimbabwe reinsurance operations and drive business into the SADC region and beyond.

“The first step was for FMHL to move both its reinsurance subsidiaries into a reinsurance holding company based in Botswana, which will be called First Mutual Reinsurance Holdings (Proprietary) Limited (FMRE HoldCo). The next step was to bring on board a strategic partner with capacity to fund additional capital requirements and ability to provide strategic insights that may assist the company’s growth plans. This also presents an opportunity to bring in a local partner for the business,” he said.