Tuesday, May 18, 2021

Bramer moves to acquire new shareholders

Bramer Life Insurance Limited has acquired new shareholders, the Botswana Opportunity Partnership (BPO), a partnership between Botswana Public Officer Pension Fund (BPOPF) and Capital Management Botswana (CMB).

The objective of this transaction is said to be to invest in businesses in Botswana on behalf of the BPOPF and CMB, formerly BIFM Capital, a subsidiary of BIHL until 2013.

Statutory Manager of Bramer Life Insurance (Pty) Ltd Nigel Warren-Dixon of KPMG revealed during a press conference on Monday that the founding shareholder Regina Sikalesele-Vaka remains as a founding shareholder thus making the company the first majority citizen-owned company in the life insurance sector, a major milestone in the history of the financial services sector in Botswana.

Warren-Dixon pointed out that the transaction has been approved by all relevant stakeholders including the relevant boards such as Non-Bank Financial Institutions Regulatory Authority (NBFIRA) and the Competition Authority.

“The company will now embark on a restructuring and rebranding that will bring to the Botswana market an indigenous company with an indigenous identity,” he said.

He further stated that Bramer Life Insurance was placed under statutory management following a financial scandal involving the majority shareholder in Mauritius. Warren-Dixon added that when the financial soundness is restored the need for the statutory manager falls away and NBFIRA will review the appointment in that light.

Asked on the new shareholding structure, Sikalesele-Vaka stated that the new shareholding is 82.5 percent citizen shareholders and 17.5 percent non-citizen shareholders while BOP is at 40 percent, CMB at 25 percent, RSV 25 percent and staff scheme is reserved 10 percent.

She is of the view that BPOPF is the largest financial institution in Botswana, adding that it brings the strength of its balance sheet and broad-based citizen membership to the company thereby facilitating the government policy of citizen economic empowerment and creating an opportunity for citizen wealth creation.

“This participation brings diversity to the foreign-owned insurance industry as more than 80 percent of the company is now owned by citizens,” she stated.

Furthermore when asked if there a conflict in CMB investing with the BOP in the same venture when they are fund managers for the BOP, Vaka denied stating that CMB is an essential partner in the venture because they possess the unique technical skills required by the company going forward so their inclusion in the company compliments the BOP and reduces the risk for the BOP investing on its own.

“The company will continue to grow the business with its team of very experienced managers who have navigated the company out of trouble. It will retain the reinsurance agreements with international reinsurers for additional protection to policyholders as required by law,” she said.

“The BPOPF is a passive investor that is not managing the company so there is no conflict. Their investment policy allows them to invest in competing entities and that is the reason that the BPOPF has, for example, invested in all of the major banks even though they are competing with each other,” said Sikalesele-Vaka.


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