Old Mutual completes acquisition of majority stake in UAP

UAP-Old Mutual Kenya Group CEO, Mr Peter Mwangi, during the announcement of a merger between UAP Holdings and Old Mutual at the Stanley Hotel in Nairobi on July 2, 2015. PHOTO | SALATON NJAU | NATION MEDIA GROUP

What you need to know:

  • Old Mutual's chief executive Peter Mwangi said remaining transactions relating to the legal structure were progressing well, in accordance with the integrated financial services strategic plan. 
  • The acquisition meant winding up business schemes previously run by UAP Holdings as the two companies continued to operate similar units in life insurance and asset management while working out the complex merger process.
  • From 2015 to 2018, Old Mutual acquired shares in UAP holdings worth Sh25.6 billion, making it the majority shareholder at 66.33 percent.

Old Mutual Limited's acquisition of majority shareholding in UAP Holdings is complete after four years of a complicated process since the deal was made public.

Old Mutual's chief executive Peter Mwangi said remaining transactions relating to the legal structure were progressing well, in accordance with the integrated financial services strategic plan. 

“These transactions are all complete, in compliance with the regulatory framework, and have approved by the relevant regulatory authorities,” he said.

From 2015 to 2018, Old Mutual acquired shares in UAP holdings worth Sh25.6 billion, making it the majority shareholder at 66.33 percent.

The acquisition was done progressively - 37.33 per cent shareholding was handed over in January 2015, 23 per cent in June that year and six per cent in 2018.

It meant winding up business schemes previously run by UAP Holdings as the two companies continued to operate similar units in life insurance and asset management while working out the complex merger process.

DISCLOSURES

There had been fears that the process faced headwinds with claims that UAP's liabilities were never disclosed to Old Mutual.

It was also said that Old Mutual came to realise that UAP's value was lower than what was paid for.

Mr Mwangi said the assertions were inaccurate.

“All shareholder movement transactions relating to UAP Holdings have been publicly disclosed through various announcements, in compliance with Capital Markets (Securities) (Public Offers Listing and Disclosures) Regulations, as the company is trading its shares publicly Over-The-Counter,” he said.

Capital Markets Authority (CMA) and Insurance Regulatory (IRA), the regulators, did not respond to phone calls, messages and emails for comment on the matter.

CMA's head of corporate communications Anthony Mwangi and Ms Noella Mutanda from the IRA neither confirmed nor denied that there were disagreements on the acquisition that was likely to head to the courts.

They also did not say whether the matter had been reported to them despite promising last Friday that they would respond.

LICENCES

In October 2015, CMA chief executive Paul Muthaura said the authority had accepted to revoke UAP’s licences as fund and Real Estate Investment Trusts (Reits) manager as well as its permits, as a collective investments scheme.

UAP Old Mutual Group is a subsidiary of Old Mutual Limited - a company listed in the Johannesburg Stock Exchange.

It has secondary listings in the London, Malawi, Namibia, and Zimbabwe stock exchanges and presence in 13 markets across Africa.