Botswana Insurance Holdings Limited (BIHL) Group exploited its healthy balance sheet to make acquisitions as the part of its five year regional expansion plan which came to a head in 2015, former Group CEO says in the latest annual report. Gaffer Hassam, who left BIHL early this year to take over a “challenging role” at Sanlam – majority shareholder of BIHL where he will be responsible for Sanlam Emerging Markets, says the purchase of 25.1 percent stake in Malawi-based Nico Holdings Limited will provide the group with a good starting point from which to expand outside Botswana. Nico Holdings, which is reported to be operating in five African countries, became a new territory for BIHL with the size of stake acquired indicating the cautious approach the group has taken.
During the year BIHL also secured a 50 percent indirect acquisition of Botswana Insurance Company (BIC), a deal which was approved by Competition Authority. Such acquisitions, Hassam believes will give BIHL a solid base from which to diversify sources of revenue within the group, specifically in the short-term industry space. “The BIC transaction will assist us to offer holistic short-term covers – combining motor, household and funeral, for example – for our clients, providing them with comprehensive solutions and us with broadened income opportunities,” Hassam says. New investments under which new acquisitions were made from part of BIHL’s five strategic business pillars which include market share and protection, operational efficiencies, group synergies and people.In terms of group synergies, Hassam says, a core philosophy within the group is “strength in numbers”.
In keeping up with strength in numbers – both in terms of the group and its subsidiaries, as well as BIHL’s relationship with Sanlam – Hassam says they have continually sought to unlock operational efficiencies within the group and find new ways to offer their products to new clients. “By cleverly using date from our subsidiaries, for example, we have identified and begun exploiting opportunities for the subsidiaries to cross-sell their product lines in ways that benefit our customers and ourselves.” BIHL saw its profit before tax in 2015 reach P722 million which is considered a threefold improvement over a period of 10 years, from P211 million which was returned to shareholders as profits before tax in 2005. The group’s profits are mainly driven by Botswana Life which is one the group’s subsidiaries with other businesses on asset management and short-term insurance.