South African insurance giant Sanlam has struck a deal to acquire a 60% stake in MultiChoice’s insurance business, aiming to leverage the pay-TV company’s vast African reach to expand its own financial services offerings.
The deal, announced on Tuesday, June 18th, will see Sanlam pay 1.2 billion rand ($66 million) upfront for the majority stake, with a potential performance-based earn-out of up to 1.5 billion rand depending on the insurance unit’s performance by the end of 2026.
While MultiChoice’s insurance arm has shown strong growth in South Africa, the partnership with Sanlam will provide “a step-up in resources, expertise and technology” needed for further local and continental expansion, according to MultiChoice.
Sanlam’s established presence across Africa and proven track record in collaborating with non-insurance companies make them a strong partner for MultiChoice, as highlighted in a joint statement by both firms.
MultiChoice will retain a 40% stake in the insurance business and a similar share in the broader financial services venture established with Sanlam. This collaboration allows Sanlam to tap into MultiChoice’s massive subscriber base of 21 million households across 50 African countries, significantly boosting its own reach. Sanlam, already operating in 31 African nations including eight of the continent’s top ten economies, will leverage its SanlamAllianz business to facilitate expansion beyond South Africa.
The news was met positively by investors, with Sanlam shares rising nearly 5% by mid-afternoon trading on the Johannesburg Stock Exchange (JSE). MultiChoice’s stock price also saw a slight increase of 0.36%.
