Pan Africa Insurance buys stake in Gateway

Pan Africa Insurance Holdings Limited has acquired a 51 per cent majority shareholding in Gateway Insurance Company Limited.

Shareholders of the latter will get Sh561,023,562 in exchange for 31,948,950 ordinary shares priced at Sh17.56 apiece.

“We are delighted to have concluded this transaction, giving us a majority stake in Gateway. Pan Africa’s Group strategy includes diversifying investments in a way that will maximise and meet client expectations while growing shareholder value. We are on a path to make Pan Africa a one-stop-shop for our client financial solutions,” board chairman John Simba said.

He said the company had returned to general insurance at a time when figures indicated that insurance penetration was low, therefore, providing huge opportunity for growth.

A CRITICAL COMPONENT

“Financial services are a critical component of any economy which intends to record sustainable growth. Insurance companies only account for 32 per cent of financial service providers in Kenya excluding co-operative societies and a measly 0.3 per cent when cooperative societies are included.

“This means that while a savings culture is budding among our people - which is how it should be - there is a gap in the area of risk management which cannot be ignored,” Mr Simba said.

“Gateway’s established brand in short-term insurance service and a countrywide presence fits well into Pan Africa strategy.”

The group structure will change to incorporate the new general insurance subsidiary so that management of the firm will be at holdings level by the group chief executive, while business lines (Life, General and Asset Management) will be headed by the respective chief executives.

Group chief executive Mugo Kibati said the new business venture would “see Pan Africa compete effectively” with their peers in the industry.