Three 2023 decisions of the Competition Authorities provide a useful guide to their approach to insurance acquisitions in South Africa and expansion into Africa.

Sanlam Emerging Markets Proprietary Limited and Another v SAN JV (RF) Proprietary Limited  [2023] ZACT 40; [2023] 3 CPLR 44 (CT) (17 August 2023)

https://www.saflii.org/za/cases/ZACT/2023/40.html

In August 2023, the Competition Tribunal conditionally approved the large merger whereby Sanlam Emerging Markets Proprietary Limited (SEM) and Allianz Europe B.V. intend to jointly acquire control of SAN JV (RF) Proprietary Limited. SEM already has a 90% shareholding in SAN JV, which is a holding company for the Sanlam Group’s strategic investments in Africa (it does not carry out any direct commercial activities in South Africa). Pursuant to the proposed transaction, the Sanlam Group and Allianz Group will contribute some of their respective African operations to a South African incorporated joint venture holding company called Sanlam Allianz Africa. Sanlam Allianz Africa will operate as a pan-African life and general insurance joint venture across the African continent, but excluding South Africa.

Although the parties will not carry out any operations together in South Africa, the Commission was concerned that, given the ongoing competitive relationship between the Sanlam Group and the Allianz Group in South Africa, the joint venture could potentially be used as a vehicle to exchange competitively sensitive information between the groups in South Africa. Therefore, the approval of the proposed merger was subject to conditions that limit the flow of competitively-sensitive information between the Sanlam Group and the Allianz Group.

In order to guard against the introduction of any activities by Sanlam Allianz Africa in South Africa, other than those investigated in relation to aYo SA (an intermediary of the parties, that conducts distribution and marketing activities), an express condition was imposed limiting Sanlam Allianz Africa’s activities in South Africa to the distribution of insurance products on behalf of the Sanlam Group through aYo SA. The merging parties agreed to the imposition of this condition.

Sanlam Ltd and Sanlam Life Insurance Ltd v AfroCentric Investment Corporation Ltd [2023] ZAFST 22 (17 May 2023)

https://www.saflii.org/za/cases/ZAFST/2023/22.html

In April 2023, the Competition Tribunal unconditionally approved the proposed acquisition by Sanlam Ltd and Sanlam Life Insurance Ltd of AfroCentric Investment Corporation Ltd. Following the implementation of the proposed transaction, Sanlam will have sole control over the AfroCentric Group. Sanlam already indirectly controlled all the operating assets of AfroCentric, who controlled the majority shares in ACT Healthcare Assets (Pty) Ltd. The parties had already been providing services to each other and the merger deepened Sanlam’s investment in AfroCentric.

Santam Ltd v Mobile Telephone Networks (Pty) Ltd and Others [2023] ZACT 15; [2023] 2 CPLR 23 (CT) (24 April 2023)

https://www.saflii.org/za/cases/ZACT/2023/15.html

In March 2023, the Competition Tribunal unconditionally approved the large merger in terms of which Santam Limited intends to acquire the device insurance policies marketed and distributed by MTN South Africa (and at that time underwritten by Guardrisk Insurance Company Limited through a cell structure), together with certain assets and liabilities pertaining to the policies (“the MTN Portfolio”). Upon implementation of the proposed transaction, Santam will become the underwriter of, and will thus acquire sole control over, the MTN Portfolio. The MTN Portfolio comprises the insurance policies marketed and distributed by MTN to its clients in respect of devices.