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RMI and Santam announce the acquisition of 100% of RMB-SI Investments Proprietary Limited (“RMB-SI”)
Rand Merchant Investment Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2010/005770/06)
ISIN: ZAE000210688
JSE ordinary share code: RMI
(“RMI”)
RMI AND SANTAM ANNOUNCE THE ACQUISITION OF 100% OF RMB-SI
INVESTMENTS PROPRIETARY LIMITED (“RMB-SI”)
Rand Merchant Investment Holdings Limited (RMI) today
announced that it has reached agreement on the sale of 100% of
the issued share capital of RMB-SI Investments Proprietary
Limited (RMB-SI) to Santam Limited (Santam) (the Transaction).
RMI has over the last few years re-activated and expanded its
portfolio. In addition to new investments, RMI’s aim is to be
a long-term, active and value-adding shareholder to its
portfolio companies. Its objective is to produce superior
returns for its shareholders, an objective which includes
dynamic and active portfolio management.
To this end, RMI and RMB-SI performed a review of the business
in the context of a changing regulatory and operating
environment and the evolving strategic objectives of RMB-SI. A
number of business lines in RMB-SI require a scalable and
efficient operational platform to establish RMB-SI for
continued growth. RMI believes that after a successful 23-year
partnership with RMB-SI’s entrepreneurial management team and
strategic co-investor, New Seasons, the business would be more
optimally positioned within a large insurance group. As its
new shareholder, Santam will provide RMB-SI’s business with an
efficient infrastructure while retaining the entrepreneurial
culture and independence, which is at the core of RMB-SI’s
ethos.
RMB-SI has over the years pioneered a specialist insurance
structuring business offering its partners and clients
individually designed and innovative insurance solutions. RMB-
SI has also established new businesses such as the recently-
formed Risk Finance Division, Credit Insurance Solutions
division and CreditInnovation, all of which are emerging as
potential market leaders in their respective fields. Over the
last two decades the business has consistently produced
superior returns on capital ratios and RMI has achieved an
internal rate of return on its RMB-SI investment in excess of
60%.
RMB-SI owns 22.4% of the issued share capital of Truffle
Capital Proprietary Limited (Truffle). Truffle is excluded
from the Transaction and, subject to the agreement of terms,
Truffle will become an affiliate of RMI’s asset management
business, RMI Investment Managers Group (RMI IMG). Through its
shareholding by RMI IMG, Truffle will be added to RMI IMG’s
stable of boutique affiliate managers, with RMI IMG acting as
a stable and supportive long-term strategic partner to Truffle
and its stakeholders.
The conclusion of the Transaction is subject to regulatory
approvals by the Financial Services Board and the competition
authorities in South Africa, as well as the relevant
regulatory authorities in Mauritius and Ireland.
The Transaction is being concluded on market-related terms and
conditions. The effective date of the Transaction is 30 June
2016 and the Transaction will not have a material impact on
the financial results of RMI.
Sandton
23 August 2016
Legal adviser to RMI
Norton Rose Fulbright South Africa Inc
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 23/08/2016 08:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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