Sanlam, Africa’s largest non-banking financial services group, has agreed to acquire the shares it does not already own in South African insurer Santam for R505 ($30.29) per share in a transaction that will take the century-old general insurer private.

Under an implementation agreement signed on October 5, 2026, Sanlam, through its wholly owned subsidiary Sanlam Life, will acquire all Santam ordinary shares not already held by Sanlam or Santam’s subsidiaries in an all-cash buyout valued at approximately R20.7 billion ($1.24 billion).

Sanlam offers premium to Santam shareholders

Sanlam currently owns 62.7% of Santam, leaving minority shareholders to receive an all-cash consideration if the proposed scheme of arrangement is approved and implemented. Based on Sanlam’s 68,958,604 shares representing 62.7%, the implied total share count is about 41 million shares, producing approximately R20.7 billion ($1.24 billion).

The R505 ($30.29) offer represents a 26.6% premium to Santam’s closing share price on October 2, while offering premiums of 25% and 28.6% to its 30-day and 90-day volume-weighted average prices, respectively.

The transaction values the equity interest being acquired from minority shareholders at approximately R18.8 billion ($1.13 billion), based on the number of shares implied by Sanlam’s existing 62.7% holding and Santam’s disclosed share base.

It had a market capitalisation of R45.9 billion ($2.75 billion) as of October 5, while Sanlam was valued at R165 billion ($9.89 billion).

Full ownership to simplify Sanlam structure

Sanlam said taking Santam private will simplify governance and reporting, improve strategic coordination and remove duplicated costs associated with maintaining Santam as a separately listed company.

The transaction is also expected to give Sanlam greater flexibility in capital allocation while strengthening its ability to integrate general insurance with its life insurance, investment management and other financial services businesses.

For Santam, Sanlam said full ownership would provide continued access to the parent company’s capital strength and scale while supporting its strategy to strengthen its South African leadership and expand internationally.

Santam profit reaches R2.19 billion

The South Africa’s largest short-term (non-life) insurance company reported net assets of R15.9 billion ($953.63 million) and profit attributable to those net assets of R2.19 billion ($131.34 million) for the six months ended June 30, 2026, according to its unaudited interim financial statements. The insurer has been listed on the JSE since 1964 and also trades on the Namibian Securities Exchange and A2X Markets.

The proposed transaction remains subject to shareholder and regulatory approvals, including approval by Santam shareholders and the relevant South African financial authorities.

If completed, Santam will be delisted from the JSE, NSX and A2X. The scheme’s longstop date is March 31, 2027, subject to permitted extensions. Sanlam has also provided an irrevocable bank guarantee from Standard Bank covering the total scheme consideration should it fail to meet its payment obligations once the transaction becomes unconditional.

Santam’s independent board has unanimously supported the transaction and will recommend that shareholders vote in favour of the scheme. The combined offer circular is expected to be published around November 3, 2026.