Monday, July 26, 2021

CA to hold public hearing on proposed acquisition of BIC by BIHL

The Competition Authority (CA) will on December 7th host a public hearing for the general public and interested parties to discuss the proposal by Botswana Insurance Holdings Limited (BIHL) to indirectly acquire Botswana Insurance Company (BIC).  

The CA said last week that the hearing is intended to allow parties to the transaction to make verbal representations to the Authority with respect to the transaction, as well as allow their competitors and the general public to express their views on the acquisition.

“The hearing will be held at the CA offices on Saturday December 7th, in accordance with the Competition Act. It is the task of the CA to adjudicate on mergers and acquisition,” read the notice from the Authority. 

BIHL is looking to indirectly acquire BIC by purchasing 50 percent shareholding from Teledimo, a company that wholly owns BIC. However, whether direct or indirect, the acquisition will have a single eventuality; BIHL will own and control BIC. The two companies have a common business line, which is short term insurance. If successful, the acquisition will bring under the BIHL fold all clients owned by BIC and give the insurance giant a lion’s share in the short term insurance space. Market analysts believe the acquisition could result in BIHL dominating the short term insurance space.

“This will eliminate competition, which could be a threat to consumers. It is very important to have a highly competitive market that ensures that consumers pay the right price for goods and services. Competition also affords consumers the opportunity to choose goods and services that give them the best value for money,” they said.

Other interested parties not party to the proposed transaction will be afforded an opportunity to voluntarily submit to the Authority documents, affidavits, statements or other relevant information in respect of the proposed acquisition. Though not mandatory, the CA said it would be preferable for interested parties to submit copies of what they intend to present to the Authority no later than 30th November.

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