Liberty Holdings Ltd., the insurer controlled by Standard Bank Group Ltd., said it has more than 1 billion rand ($87 million) to make acquisitions in Africa and plans to raise more funds if needed, reports Bloomberg.
“We intend to raise capital for large acquisitions, so if a big one lands then we’ll probably do a combination of debt and equity,” Thabo Dloti, head of the Johannesburg-based insurer, said by phone on Thursday.
“The big issue is bolstering our East African businesses. We also need sizable businesses in West Africa — we need insurance and we also need asset management in Nigeria.”
Liberty, South Africa’s fourth largest insurer, has followed parent Standard Bank into the rest of Africa to hunt for growth as domestic opportunities wane.
The company bought Standard Bank Investment Management Services Ghana in October, giving it a presence in more than 15 African countries, and may conclude a Nigerian insurance deal by the end of March, according to Dloti.
Liberty’s net income for 2014 rose less than 1 percent to 3.92 billion rand from 3.91 billion rand a year earlier, the insurer said in a statement.
Investment returns declined, margins on new business fell and earnings per share excluding one-time items declined 3 percent to 13.92 rand. That beat the 13.53 rand per share median estimate of eight analysts surveyed by Bloomberg.
The stock advanced 1.2 percent to 138.30 rand at 9:03 a.m. in Johannesburg trading. It was the biggest gainer among the six members of the FTSE/JSE Africa Life Assurance Index.
“Stanlib suffered from the negative sentiment to money market funds following the African Bank failure as well as investor trends to higher-risk asset classes,” Liberty said, referring to the company’s asset management unit.
“This contributed to net withdrawals of 13.7 billion rand from the various Stanlib money market funds.”
African Bank Investments Ltd. failed in August and this dealt a blow to many asset managers’ money-market funds. However, South Africa’s central bank crafted a rescue plan for Abil, as the company is known. But the lender has delayed any plans for an initial public offering.