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Continental Reinsurance Plc acquires 100% ownership of its Botswana subsidiary

Continental Reinsurance Plc now holds 100% of issued ordinary share capital in its subsidiary.

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Continental Reinsurance

Continental Reinsurance Plc has announced 100% ownership of its Botswana subsidiary, as it posts strong growth in its H1 2020 results.

In a bid to continue in its quest for geographical diversity, Continental Reinsurance Plc announced, that it has acquired a minority 40% stake in its Botswana subsidiary, known as Continental Reinsurance Ltd (Botswana), through its holding company – CRe African Investments Limited (“CRAFIL”).

This is contained in a press release released September, 10 and signed by the firm’s Group Communications Manager, Elsie Mbera.

The acquisition means, Continental Reinsurance Plc now holds 100% of the issued ordinary share capital in the subsidiary, effectively announcing a change in the ownership structure of Continental Reinsurance Ltd (Botswana).

On the rationale behind the deal, the Group Managing Director, Dr Femi Oyetunji, was quoted saying: “The acquisition means not only growth in economic size, but also presents us with an opportunity to enhance our strategic influence, and broaden our market appeal through the expansion of stakeholder segments that we actively interact with.”

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On who will lead its newly acquired Botswana subsidiary, Dr Femi added that, “Building on our talent growth and diversity strategy, we have appointed Mr Francis Nzwili as Managing Director. Previously with our Nairobi subsidiary, as Managing Director of the Botswana business, Francis comes on board with a wealth of experience in underwriting and business development, that significantly complements the strength of the existing team. The position of Managing Director was previously held by Mr Cas Hansa, who has taken up new strategic responsibilities as Group Head: Underwriting and Claims.”

Continental Reinsurance, established in 1985, is a composite private pan-African reinsurer that has been on the continent for more than 30 years, writing business in more than 50 countries across the African continent. It provides support to over 200 insurance companies in Africa, with its main offices in Nigeria, Cameroon, Kenya, Côte d’Ivoire, Tunisia and Botswana.

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Corporate deals

Paystack acquired by Stripe for a reported $200 million in the biggest fintech acquisition in Nigeria’s history

Nigerian fintech startup, Paystack has been acquired by global fintech giant, Stripe.

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Paystack acquired by Stripe for a reported $200 million in the biggest fintech acquisition in Nigeria's history

PayStack, a Nigerian fintech startup, has been acquired by global fintech giant Stripe, in the biggest M&A deal in Nigerian tech and one of the biggest in Nigerian corporate history. Paystack was founded in 2016 by Ezra Olubi and Shola Akinlade.

This was disclosed in a press release seen by Nairametrics. The statement read in part:

“In order to help grow Africa’s online GDP, Stripe has entered into an agreement to acquire Paystack, a technology company based in Lagos that makes it easy for organizations of all sizes to collect payments from around the world.

READ: Nigerian Fintech Startup, Piggybank.ng, secures $1.1M Seed Funding

READ: How these healthcare startups are changing the narratives in the ecosystem

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“Today, more than 60,000 businesses in Nigeria and Ghana use Paystack to securely collect online and offline payments, launch new business models, and deepen customer relationships.

“Incredibly, Paystack already processes more than half of all online transactions in Nigeria.
Paystack has ambitious plans to expand across the continent and recently started a pilot with businesses in South Africa.

“Stripe and Paystack have been working closely together for some time. In 2018, Stripe led Paystack’s Series. A financing round and has provided ongoing guidance as the company rapidly scaled.”

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READ: FairMoney secures EUR 10 million seed funding, to widen mobile banking services in Nigeria 

Following the announcement, TechCrunch on Thursday afternoon reported that Stripe had raised $600 million to invest and acquire payments companies in developing nations. It disclosed that the Nigerian startup had been on Stripe’s bucket list for a while since 2018 when Stripe led an $8 million funding round for PayStack.

Paystack Co-founder Sola Akinlade told TechCrunch that the company was not up for sale when Stripe initially approached for the acquisition; however, the founders are mission-driven and believed Stripe could accelerate it. Akinlade also disclosed PayStack investors, VISA and Tencent also approached to acquire the company.

READ: 3 startup lessons from Kobo360’s $30 million fund raise

“Paystack was not for sale when Stripe approached us.

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“For us, it’s about the mission. I’m driven by the mission to accelerate payments on the continent, and I am convinced that Stripe will help us get there faster. It is a very natural move,” Akinlade said.

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READ: The “EndSARS” protests and the problem of police reform in Nigeria

Backstory

Nairametrics reported in 2016 when Paystack raised its initial $1.3 Million Seed Funding from both international and homegrown investors.

Founders Ezra Olubi and Shola Akinlade were the toast of the tech space when their company became the first Nigerian tech startup to be accepted into the world-famous Y Combinator program, based in Silicon Valley. They obtained an initial $120,000 seed funding and further technical advice at the program.

READ: #EndSARS: Nigerian firms, Start-ups donate millions in support of protests

READ: E-Settlement Partners Seriate for acquisition and deployment of 20,000 mPOS

What they are saying

Patrick Collison, CEO of Stripe, told TC that the deal with PayStack is an enormous opportunity, as African e-commerce grows by 30% every year, which would give Stripe an early footing in the region.

“This is an enormous opportunity,” he said.

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“In absolute numbers, Africa may be smaller right now than other regions, but online commerce will grow about 30% every year. And even with wider global declines, online shoppers are growing twice as fast.

READ: New report details how Nigerian fintech companies are expanding their business scopes

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“Stripe thinks on a longer time horizon than others, because we are an infrastructure company. We are thinking of what the world will look like in 2040-2050.”

He added that Stripe is also planning  on understanding the ecosystem and keep its eyes  open so it can see where help is needed, as the company does not tie up its investments into “complicated strategic investments.”

Collison said that many companies depend on Stripe’s infrastructure, but with PayStack, the founders have organic input in running their operations.

READ: Meet Sola Akinlade, co-founder of Nigeria’s foremost payment platform Paystack

READ: Paystack explains how it will use Truecaller to verify merchants

Stripe said the announcement of the acquisition was delayed due to the #EndSARS protests across the country.

“A lot of companies have been, let’s say, heavily influenced by Stripe.

“But with Paystack, clearly they’ve put a lot of original thinking into how to do things better. There are some details of Stripe that we consider mistakes, but we can see that Paystack ‘gets it’. It’s clear from the site and from the product sensibilities, and that has nothing to do with them being in Africa or African.”

READ: Nigerian fintech companies raised $600 million in five years – McKinsey Report 

Shola Akinlade said the payments ecosystem is still broken and PayStack is still in its early days. PayStack provides payments API for companies and takes a cut from every transaction. The company has 60,000 customers so far, from SMEs to large cooperation,s and would continue to run independently.

Techcrunch said the full terms of the deal were not disclosed. However, TC confirmed that it is worth over $200 million, making it the largest tech acquisition in Nigerian corporate history.

READ: CBN to sanction exporters who default on export proceed number

What you should know

According to Crunchbase, PayStack has raised $11.7 million so far.

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Corporate deals

London Stock Exchange seals $5billion Borsa Italiana sale

The sale is aimed at dousing tensions amidst growing concerns over LSE control of the European Bond market.

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London Stock Exchange seals $5billion Borsa Italia sale

In what appears to be a landmark trade deal, the London Stock Exchange (LSE) has agreed to a €4.3 billion ($5.1 billion) with Euronext to sell Borsa Italiana. This is according to insider sources from both firms.

If successful, the deal would bring LSE a step closer to clinching approval for its $27 billion purchase of Refinitiv, which is 45% owned by Thomas Reuters. The sale is aimed at dousing tensions amidst growing concerns over LSE control of the European Bond market.

READ: DEAL: Custodian Investment agrees to buy majority stake in UPDC

This is corroborated in a statement by London Stock Exchange Chief Executive, David Schwimmer, “We believe the sale of the Borsa Italiana group will contribute significantly to addressing the EU’s competition concerns,”

Recall earlier that LSE had entered exclusive talks with Euronext last month after the Paris bourse owner saw off competition from Deutsche Boerse DB1Gn.DE and Swiss rival SIX. The deal presents an opportunity for Euronext to expand its equity operations, while it presents an opportunity for LSE to recoup the €1.6.

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The deal will afford Euronext the opportunity to commence its first fixed income training via Borsa’s bond trading platform MTS.

(READ MORE: Global stocks close mixed on growing geopolitical concerns)

Commenting on the deal, the CEO of Euronext, Stephane Boujnah said “Euronext will significantly diversify its revenue mix and its geographical footprint by welcoming the market infrastructure of Italy, a G7 country and the third-largest economy in Europe.”

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How will the deal be funded?

Euronext with a market value of around 7 billion euros, might not be able to pull an outright cash deal without a sizeable amount of debt instruments. Hence, the firm plans to issue 1.8 billion euros in debt and raise 2.4 billion euros in new equity to fund it.

READ: MTN seeking to sell stake in Jumia Technologies AG

To raise funds and specifically secure the Italian government’s support, Euronext collaborated with state agency Cassa Depositi e Prestiti (CDP) and Italy’s biggest bank Intesa SanPaolo, who will subscribe to 700 million euros of Euronext’s equity issue.

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Corporate deals

Guinness Nigeria’s parent company acquires Hollywood actor, Ryan Reynolds’ Gin brand

Guinness Nigeria’s parent company has acquired a gin brand co-owned by actor, Ryan Reynolds.

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Guinness Nigeria’s parent company acquires Hollywood actor, Ryan Reynolds’ Gin brand

Diageo Holdings Plc, the world’s largest spirits maker has completed the acquisition of Aviation American Gin and its parent company Davos brands, co-owned by Hollywood star actor Ryan Reynolds.

This disclosure is contained in a press release by the company, which was seen by Nairametrics.

The acquisition of Aviation Gin LLC and its parent company, Davos Brands LLC, cements Diageo as the world’s largest gin brand in the world.

READ: Guinness’ parent company expects alcohol sales to improve as restaurants and bars gradually reopen

The total consideration of the acquisition is put at $610 million, which includes an initial payment of $335 million and a further potential consideration of up to $275 million, based on the performance of Aviation American Gin over a ten-year period. This, however, reflects the brand’s current growth trajectory and expected upside potential.

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The Management of Diageo Holdings Plc, said that the acquisition supports the company’s participation in the super-premium gin segment in the US, and is in line with the company’s strategy to acquire “high growth brands with attractive margins,” which supports its premiumization ambitions.

 (READ MORE: Oracle wins bid to acquire TikTok’s US operations after Microsoft offer was rejected)

Ivan Menezes, Chief Executive officer of Diageo said; “We are confident that Aviation American Gin will continue to shape and drive the growth of super-premium gin in North America, and we are looking forward to working with Ryan Reynolds and the Davos Brands team to accelerate future growth.”

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READ: Analysis: Nigerian Breweries, the glory days are gone

Aviation American Gin is an American style gin crafted with a blend of botanicals, with subtle juniper notes, delivering a smooth balanced flavor profile. The brand has thrived under the leadership of its majority owner, Davos Brands, and the creative direction of co-owner Ryan Reynolds, who will retain an ongoing ownership interest in Aviation American Gin.

Through this acquisition, Diageo is also acquiring the other brands in the Davos Brands’ portfolio, consisting of Astral Tequila, Sombra Mezcal, and TYKU Sake.

READ: How Nike rejection birthed sportswear industry in Nigeria

Fact: Diageo Overseas Holdings Limited, is the parent organization of Guinness Overseas Limited. Guinness Overseas Limited, as of 30 June 2020, owned 50.18% of the issued share capital of Guinness Nigeria Plc.

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