Financial services giant Sanlam today announced it had signed agreements with Patrice Motsepe controlled African Rainbow Capital Financial Services (ARC FS) to establish one of the largest black-empowered asset management firms in South Africa.
Once this transaction becomes effective, ARC FS will own 25% economic interest in Sanlam’s South African third-party asset management business other than the investment management business conducted by Sanlam Private Wealth and the Sanlam Specialised Finance division.
Paul Hanratty, Sanlam Group CEO, said this transaction would, among others, enable Sanlam to explore opportunities to further develop its third-party asset management business, in partnership with Ubuntu-Botho Investments (UBI) and African Rainbow Capital (ARC).
Motsepe’s investment vehicle UBI is Sanlam’s largest shareholder. “We are absolutely delighted with the creation of a new powerful asset manager in South Africa in partnership with Ubuntu-Botho Investments and African Rainbow Capital. The relationship between Sanlam and our partners continues to create value for Sanlam shareholders and the wider community that we serve in South Africa. This transaction takes Sanlam a step further on the journey to becoming South Africa’s leading asset manager,” Hanratty said.
Motsepe said: “With the latest transaction, I am of the firm belief that it will enhance Sanlam’s business as a serious contender in this highly competitive asset management space. As before, UBI via ARC FS will competitively position and support Sanlam management to seize growth opportunities – to the benefit of both Sanlam and Ubuntu-Botho Investments stakeholders.”
The transaction is expected to be concluded before the end of the year. ARC has been making serious inroads in the financial services sector. The company is currently the biggest shareholder in Alexander Forbes.
