Thursday, June 18, 2015
KCB TO ACQUIRE MADISON INSURANCE?
The nation's largest bank by assets KCB Group is said to be considering a takeover of Madison Insurance as the insurance sector heats up.
This would be the latest takeover of a local insurance group in a series of buyouts dating back to last year.
Britam set the dice rolling with its purchase of REAL Insurance before UK-based Prudential swooped down on Shield Assurance. Old Mutual bought a controlling stake in UAP Group before the latest announcement that Barclays Africa will take over First Assured.
Against this backdrop, the Financial Bill 2015/16 read by CS Rotich last week, raised the capitalization requirements for insurance companies portending possible consolidation in the crowded market.
There are 53 licensed insurance companies in Kenya. Their business is brokered by a further 196 agents.
Madison Insurance said it collected Sh2bn in premiums this past year and its assets stand at Sh5.1bn.
The company is owned by the Amedo Madison Holding Group whose anchor shareholders are Samuel Ngaruiya and James Mwangi Wainaina through an entity named Mlima Education Trust.
KCB is of course the largest bank in the region by assets (Sh510bn) hence the tendency for industry colleagues to refer to it as "Benki Kuu"
Observers note that the bancassurance sector may be shaping up to be lucrative for banks informing this flurry of activity.
A number of South African players are also looking for viable takeover targets with strong preference for strong, local brands with no multinational affiliation.
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