Britam Holdings Limited

Britam Holdings Limited, previously known by as British-American Investments Company, is a diversified financial services group and is listed on the Nairobi Securities Exchange. The group offers a wide range of financial products and services in insurance, asset management, property, and banking in the African Great Lakes region.

Not to be confused with British American Investment Company (Mauritius).

Britam Holdings Limited
Public KN: BRIT
IndustryInsurance, Investments, Property, Financial services
Founded1965
HeadquartersBritam Centre, Upper Hill
Nairobi, Kenya
Key people
Walter Andrew Hollas
Chairman of the Board
Benson I. Wairegi
Group Managing Director
Margaret Kathanga
Chief Executive Officer & Principal Officer
Products
Revenue KES: 23.30 billion (2017)
KES: 14.74 billion (2014)
KES: 3,73 billion (2014)
Total assets KES: 99.0 billion (2017)
Total equity KES: 22.67 billion (2017)
Websitehttps://www.britam.com/

Overview

Britam's headquarters are in Nairobi, Kenya, with subsidiaries in Kenya, Uganda, South Sudan, Rwanda, Tanzania, Malawi, and Mozambique. The flagship company of the group is the British-American Insurance Company (Kenya) Limited, commonly referred to by its brand name Britam Kenya.[1]

According to the Insurance Regulatory Authority report released in September 2014, Britam Kenya was ranked second in market share with 11.2 percent of the market behind Jubilee Insurance Company of Kenya, which controlled 11.9 percent.[2]

History

1965-1999

The group's operations commenced in Kenya in 1965 with the opening of the first office in Nairobi as a foreign branch of British-American Insurance Company Limited, headquartered in the Bahamas. A local company was incorporated on 14 November 1979 as British-American Insurance Company (Kenya) Limited under the Companies Act as a private limited liability company following a government directive that all branches of foreign owned insurance companies must be incorporated locally. By this time, the Company had established nine branches across Kenya. This local incorporation represented the first step in the localisation of the Company. In 1984, local Kenyan investors acquired 33.33 percent of the shareholding in line with government directives.[1]

2000-2009

In 2004, the group incorporated British-American Asset Managers whose core business was the provision of Investment advisory and Fund management services. The company offers investment funds, structured as Unit trusts and discretionary Portfolio management, to both institutions and private clients. During the same year, the group restructured, creating a non-operating holding company.[1] Also in 2004, Britam acquired a strategic equity stake in the Equity Group Holdings Limited. Britam made its first equity acquisition in Housing Finance Company of Kenya (the largest mortgage finance provider in East Africa) in 2007.[3]

2010-To date

2010 marked Britam's regional expansion commencing with the group's expansion into Uganda with the incorporation of Britam Insurance Company (Uganda) Limited, which commenced business on 24 November 2010, following the issuance of an insurance license by the Uganda Insurance Commission.[4]

In 2011, the shares of British-American Investments Company were listed on the Nairobi Securities Exchange through an under-subscribed Initial Public Offering. This was largely the result of risk-averse foreign investors shunning the IPO because of the Eurozone crisis and a sluggish U.S economy.[5] Britam Insurance Company (South Sudan) Limited was incorporated in February 2012 and is licensed to underwrite all classes of life and non-life insurance.[6] In Rwanda, Britam Insurance Company (Rwanda) Limited, was incorporated and licensed in 2013 by the National Bank of Rwanda.[7][8]

On 9 December 2013, the British-American Investments Company entered into a definitive Share Purchase Agreement with Royal Ngao Holdings to acquire its 99 percent shareholding in Real Insurance Company Limited, a deal that was valued at KSh1.4 billion (approximately US$16 million then). 60% of the sales price was paid in cash and 40% was paid by issuance of new shares in British-American Investments Company. Real Insurance was licensed insurer carrying out General insurance business in Kenya, Tanzania, Malawi, and Mozambique. It had been a player in the Kenyan insurance sector since 1910.[9] This transaction led to the expansion of Britam to Tanzania, Malawi, and Mozambique. Britam and Real Insurance only had parallel insurance businesses in Kenya. The Kenyan businesses would be consolidated. The acquisition of Real Insurance was approved by the shareholders of Britam on 19 February 2014.[10]

In April 2014, the group announced its intention to acquire 30 percent of Continental Re Kenya Limited, a fully owned subsidiary of Lagos-based Continental Reinsurance Plc., in a deal valued at KSh300 million (approximately US$3.4 million). This acquisition was in a bid for the group to consolidate its market share and broaden revenue sources.[11] The acquisition will be funded by a planned bond issue.[12]

On 30 June 2014, British-American Investments Company served a takeover notice on the board of directors of the Housing Finance Company of Kenya to acquire the 24.76 percent shareholding that Equity Group Holdings Limited (EBG) held in the mortgage lender at that time.[13] This transaction was completed on 31 December 2014 and it increased Britam's stake in Housing Finance to 46.1 percent.[14]

In June 2015, the shareholders adopted a resolution to change the company name from British-American Investments Company to Britam Holdings Limited.[15]

Subsidiaries and investments

The companies that compose the Britam Holdings Limited are organised into four divisions and include, but are not limited, to the following:[16]

Insurance
  • Britam Life Assurance Company (Kenya) Limited – Nairobi, Kenya – 100% Shareholding – The flagship company of the group. Offering General insurance and Life insurance.
  • Britam General Insurance Company (Kenya) Limited – Nairobi, Kenya – 100% Shareholding – Offering General Insurance and Holding Company for Tanzania, Malawi and Mozambique subsidiaries. Real Insurance Company is the oldest member having been founded in 1910 as a subsidiary of Royal Insurance, now part of RSA Insurance Group.
  • Britam Insurance Uganda Limited – Kampala, Uganda – 100% Shareholding – Offering General and Life Insurance.
  • Britam Insurance South Sudan Limited – Juba, South Sudan – 100% Shareholding – Offering General and Life Insurance.
  • Britam Insurance Rwanda Limited – Kigali, Rwanda – 100% Shareholding – Offering General Insurance.
  • RICEA Management Services Company – Nicosia, Cyprus – 100% Shareholding[17] – Held through Real Insurance Company Limited – Management services of the Real Insurance subsidiaries.
  • Britam Insurance Tanzania Limited– Dar es Salaam, Tanzania – 54.45% Shareholding – Held through Real Insurance Company Limited – Offering General Insurance
  • Britam Insurance Company Malawi Limited – Blantyre, Malawi – 64.35% Shareholding[18] – Held through Real Insurance Company Limited – Offering General Insurance. Started operating in 1959, making it the oldest insurance company in Malawi. It was listed on the Malawi Stock Exchange on 29 September 2008 through a successful IPO that was over-subscribed by 300%. It is the only listed insurance company in Malawi.[19]
  • Britam Companhia De Seguros De Mozambique, S.A – Maputo, Mozambique – 97.02% Shareholding – Offering General Insurance

Asset Management
  • British-American Asset Managers (BAAM) Kenya Limited – Nairobi, Kenya – 100% Shareholding – Offering Financial services, investment management, Private equity and Investment advisory services.
  • British-American Asset Managers (BAAM) Uganda Limited – Kampala, Uganda – 100% Shareholding – Offering financial services, investment management and investment advisory services.

Property
  • Bramer Properties Limited – Nairobi, Kenya – 100% Shareholding – Real Estate and REITs.

Banking Holding

Ownership

In September 2017, the International Finance Corporation (IFC), an arm of the World Bank Group, concluded the acquisition of a 10.37 percent stake in Britam, thereby gaining a seat on the company's board of directors.[20]

The shares of the stock of Britam Holdings Limited are traded on the Nairobi Stock Exchange, under the symbol: BRIT. As of 31 December 2017, the shareholding in the company's stock, was as depicted in the table below:[21][22]

Britam Holdings Limited Stock Ownership
RankName of OwnerPercentage Ownership
1 Equity Holdings Limited 18.73
2 Plum LLP 16.12
3 Standard Chartered Nominees KE11396 10.66
4 Standard Chartered Nominees
Non-Resident KE11752		 10.37
5 Jimnah M. Mbaru 7.62
6 Benson Wairegi 4.64
7 Peter Munga 3.47
8 James Mwangi 3.47
9 Co-op Bank Custody A/C 4012 2.77
10 Filimbi Limited 2.70
11 Other Local & International Investors 19.45
Total100.00

Governance

British-American Investments Company is governed by an eleven-person Board of Directors with Walter Andrew Hollas serving as the Chairman of the group and Benson I. Wairegi as the CEO.[23]

Britam Tower

Britam Tower is a 31-storey building under construction in Upper Hill, Nairobi and when completed, its projected to be the tallest building in Kenya and the third tallest in Africa. The tower's construction began in October 2013 and is set to cost in excess of US$70 Million. The tower is set to have wind turbines that would generate power for parts of the building. The complex will comprise offices, banking halls, restaurants and retail stores.[24]

Controversies

Bramer Banking Corporation Scandal

In April 2015, a US$693 million Ponzi scheme in Bramer Banking Corporation hit Britam's largest shareholder British American Investment Company Mauritius Limited (BAIC).[25][26] The Group moved swiftly to inform the public that the ponzi scheme did not affect their operations.[27] However, the directors were put under investigation by the IRA.[28] The Mauritian government appointed receiver managers at BAI Co. later announced their intention to dispose of the group's entire shareholding in Britam.[29] Dawood Rawat moved to the International Court of Arbitration in France to block this sale. As of January 2017, the case was ongoing.[30]

Peter Munga, a Kenyan billionaire and Britam shareholder with an initial 16.96 percent shareholding acquired 23.3 percent in new shareholding that he bought from the Government of Mauritius at an undisclosed sum in June 2016, bringing his new total shareholding to 40.26 percent. At the time, Munga stated that he would dispose of the newly acquired shareholding, in approximately two years.[31][32] In January 2017, the International Finance Corporation agreed to invest KSh3.5 billion (approx. US$35 million) in Britam, in exchange for 10.37 percent shareholding. The company issued 224.1 million new ordinary shares to IFC, reducing the shareholding of existing shareholders by 10.3 percent, reducing Munga's total ownership to 36.0 percent.[33]

Recent developments

In April 2019, the Business Daily Africa newspaper reported that the Swiss insurer, Swiss Re had acquired 15.79 percent in Britam Holdings Limited. Africinvest, now the largest shareholder, owns 16.2 percent. The International Finance Corporation controls 8.8 percent. At that time, the original founders, maintained a combined 39.2 percent equity ownership in the company.[34]

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See also

References
  1. Britam, . (29 June 2011). "British-American Investments Company IPO Prospectus" (PDF). British-American Investments Company (Britam). Retrieved 30 November 2014.CS1 maint: numeric names: authors list (link)
  2. Herbling, David (21 December 2014). "CIC rises past ICEA to be third-largest insurance firm". Business Daily Africa. Nation Media Group. Retrieved 22 December 2014.
  3. "British-American Investments Company Shareholders Circular of 24 January 2014, Pages 26 & 27" (PDF). British-American Investments Company. 24 January 2014. Archived from the original (PDF) on 14 May 2014. Retrieved 30 November 2014.
  4. Ainomugisha, Lydia (20 July 2011). "Britam Insurance Enters Uganda". The Observer (Uganda). Retrieved 30 November 2014.
  5. Gachenge, Beatrice (23 August 2011). "Kenya's British-American IPO Undersubscribed". Reuters. Retrieved 30 November 2014.
  6. Mutegi, Mugambi (8 March 2012). "CFC & British American To Open Shop In South Sudan". Business Daily Africa (Nairobi). Retrieved 30 November 2014.
  7. BNR, . "National Bank of Rwanda: Licensed Private Insurers In Rwanda". National Bank of Rwanda (BNR). Retrieved 30 November 2014.CS1 maint: numeric names: authors list (link)
  8. Editor, . (30 July 2013). "International Insurance Firm Opens In Rwanda". RwandaPost.Org Quoting Rwanda Eye. Archived from the original on 15 December 2014. Retrieved 30 November 2014.CS1 maint: extra text: authors list (link) CS1 maint: numeric names: authors list (link)
  9. Mugwe, David (24 November 2013). "Britam To Buy Real Insurance In A Share Deal". Business Daily Africa (Nairobi). Retrieved 30 November 2014.
  10. Wachira, Charles (20 February 2014). "Britam Kenya Shareholders Approve Acquisition of Real Insurance". Bloomberg News. Retrieved 30 November 2014.
  11. Herbling, David (14 April 2014). "Britam Seeks KSh300 Million Stake In Nigerian Firm". Business Daily Africa (Nairobi). Retrieved 30 November 2014.
  12. Gachiri, John (21 May 2014). "Britam Eyes Bond In Expansion Drive". Business Daily Africa. Retrieved 30 November 2014.
  13. Masinde, Joshua (30 June 2014). "Equity Bank Exits Housing Finance Through Sale of Its Shares To Britam". Daily Nation (Nairobi). Retrieved 30 November 2014.
  14. Paul Richardson, and Eric Ombok (1 July 2014). "Britam of Kenya to Buy Equity Bank's Housing Finance Stake". Bloomberg News. Retrieved 30 November 2014.
  15. "Britam name change". Britam Holdings Limited. 26 June 2015. Archived from the original on 7 July 2015. Retrieved 6 July 2015.
  16. "Britam Holding 2016 Annual Report". 31 December 2016. Retrieved 28 September 2017.
  17. RICL, . (March 2013). "Real Insurance 31 December 2012 Annual Report" (PDF). Real Insurance Company Limited (RICL). Archived from the original (PDF) on 12 August 2014. Retrieved 30 November 2014.CS1 maint: numeric names: authors list (link)
  18. RICML, . (March 2010). "Real Insurance Company of Malawi Limited 2009 Annual Report" (PDF). Real Insurance Company of Malawi Limited (RICML). Archived from the original (PDF) on 12 August 2014. Retrieved 30 November 2014.CS1 maint: numeric names: authors list (link)
  19. Helema, Innocent (11 August 2014). "Britam & Real Complete Deal". The Nation (Malawi). Retrieved 30 November 2014.
  20. Otuki, Neville (15 September 2017). "IFC completes buying 10.3pc stake in Britam". Business Daily Africa. Narobi. Retrieved 15 September 2017.
  21. Britam (22 March 2018). "Britam Annual Report for the Year Ended 31 December 2017". Nairobi: Britam Holdings Limited. p. 45. Retrieved 4 June 2018.
  22. Juma, Victor (4 June 2018). "Billionaire Munga cashes in Sh1.3 billion Britam shares". Business Daily Africa. Nairobi. Retrieved 4 June 2018.
  23. Britam (4 June 2018). "Britam Board of Directors". Nairobi: Britam Holdings Limited. Retrieved 4 June 2018.
  24. "Britam Tower". Britam Holdings Limited. Archived from the original on 3 March 2014. Retrieved 10 November 2015.
  25. Jordan D. Maglich (3 April 2015). "Mauritius Halts $693 Million Ponzi Scheme At Bank". Ponzitracker.com. Archived from the original on 26 September 2015. Retrieved 15 September 2017.
  26. AROUFF, Jean Paul (3 April 2015). "Mauritius revokes Bramer Bank licence, PM says Ponzi scheme found". Reuters. Thomson Reuters. Retrieved 9 April 2015.
  27. Wachira, Charles (7 April 2015). "Britam of Kenya Says It's Separate From Suspended Mauritian Bank". Bloomberg Business. Bloomberg L.P. Retrieved 7 April 2015.
  28. Mutegi, Mugambi (20 April 2015). "IRA probes Britam directors over Bramer bank scandal". Business Daily Africa. Nairobi. Retrieved 21 April 2015.
  29. Richardson, Paul (18 June 2015). "Britam of Kenya's Biggest Holder Has Stake Put Up for Sale". Bloomberg Business. Bloomberg L.P. Retrieved 18 June 2015.
  30. Sam Luttrell, and Clementine Packer (11 January 2017). "Case comment: Dawood Rawat vs The Republic of Mauritius" (PDF). Disputes Centre of Australia. Retrieved 15 September 2017.
  31. Ngigi, George (14 June 2016). "Munga makes Sh9 billion bet on Mauritian's Britam shares". Business Daily Africa. Nairobi. Retrieved 16 September 2017.
  32. Juma, Victor (3 July 2016). "Two-year window gives Munga upper hand in sale of Britam stock". Business Daily Africa. Nairobi. Retrieved 16 September 2017.
  33. Juma, Victor (3 January 2017). "World Bank arm eyes KSh3.5 billion stake in insurance group Britam". The Citizen Mobile. Dar es Salaam.
  34. Juma, Victor (18 April 2019). "Britam founders cede control in Mbaru deal". Business Daily Africa. Nairobi. Retrieved 18 April 2019.
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