IFC Investment in Assupol Helps Expand Access to Insurance for Low-Income South Africans
JOHANNESBURG, South-Africa, June 5, 2012/African Press Organization (APO)/ — IFC, a member of the World Bank Group, agreed today to make an equity investment of up to ZAR 170 million (approximately $20 million) in Assupol Holdings Limited, the holding company of Assupol Life Limited. Assupol Life Limited, formerly a mutual society that was converted into a public company and demutualized during December 2010.. The investment will position Assupol to gain more recognition among investors as Assupol develops a business strategy to serve more low-income customers in South Africa.
Founded in 1913, Assupol Life is a well established provider of insurance products and has been expanding offerings to all South Africans since the 1980s. Assupol’s products include life, disability and accident cover, funeral cover, retirement products, and savings and investment products.
Its client base is highly concentrated among previously disadvantaged groups, especially low-income South Africans.
Rudi Schmidt, Assupol CEO said, “Assupol has developed an innovative business model in South Africa to serve a wide range of customers, especially those at the base of the pyramid. In partnership with IFC, Assupol will be able to increase the safety net for those who need it most in South Africa.”
The former members of Assupol Life became shareholders of Assupol Holding Limited as part of the demutualization process. The company anticipates that other investors, starting with IFC and complemented by new Black Economic Empowerment investors and partners, will bring new capital that will allow Assupol to expand its operations and better serve its customers.
IFC’s participation as a shareholder is an important milestone for Assupol, in a process that is expected to culminate in a listing on the Johannesburg Stock Exchange.
Jean Philippe Prosper, IFC Director for Eastern and Southern Africa, said, “IFC strongly supports Assupol’s mission to deliver services and reduce risks for low-income South Africans. Assupol has developed a strong business and built a solid reputation in the insurance market that will help it expand further in South Africa and into other countries in the future.”
The transaction is part of IFC’s strategy to expand its investment activities in the insurance sector, with the goal of increasing availability of insurance products that address individual needs such as property, life and health insurance as well as access to savings products.
IFC’s effort also involves partnering with leading insurance companies that have developed a solid know-how which can be taken to other emerging markets by way of regional or global expansion.
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, providing advisory services to businesses and governments, and mobilizing capital in the international financial markets. In fiscal 2011, amid economic uncertainty across the globe, we helped our clients create jobs, strengthen environmental performance, and contribute to their local communities—all while driving our investments to an all-time high of nearly $19 billion.
For more information, visit www.ifc.org.
For more information on Assupol, visit www.assupol.co.za
International Finance Corporation (IFC) – The World Bank
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