South Africa’s Sanlam has raised R5.7 billion ($490 million) from selling new shares to help fund its joint acquisition of Moroccan company SAHAM Finances, the insurer said on Wednesday.
Sanlam said it placed 65.5 million new shares, or roughly a 3% stake, through an accelerated bookbuild process to institutional investors for R87 per share, representing a discount of 5% to its closing price on Tuesday.
Sanlam, along with rival South African insurer Santam, said earlier this month that it will buy the rest of SAHAM Finances for $1 billion, as part of a plan to become a pan-African insurance group.
It said the proceeds from the placing will be used to fund that acquisition.
“The success of this placing indicates the significant investor confidence in Sanlam following a long period of consistent delivery on our strategic priorities and is evidence of the renewed confidence in South Africa as well,” Sanlam Group Chief Executive Officer, Ian Kirk said in a statement.
Subject to approval by the Namibian Stock Exchange Limited, the placing shares will also be listed on there.
JP Morgan and Deutsche Bank are acting as joint global coordinators and joint bookrunners.