Nssa consolidates insurance firms

HARARE - The National Social Security Authority (Nssa) is moving to consolidate its position in the insurance sector amid indications it wants to merge interests in two Zimbabwe Stock Exchange-listed stalwart insurance counters.

Listed short-term insurer NicozDiamond Insurance Limited (NDIL) — in which Nssa holds a 44,85 percent stake — yesterday said the major shareholder had expressed interest to dispose its controlling stake to another insurance group.

“The board of directors of NDIL advise shareholders and other stakeholders that it has been informed by its major shareholder of the intention to dispose of its interest in NDIL to another insurance group subject to conditions precedent including regulatory approvals as well as shareholder approval,” NDIL company secretary Gloria Zvaravanhu said.

Similarly, First Mutual Holdings — 51,33 percent owned by Nssa, as at March 30, 2016 — also said it was contemplating acquiring a controlling interest in a company in the insurance sector.

Nssa — which recently upped its NDIL shareholding to 44,85 percent late last year — announced through FML company secretary, Sheila Lorimer, that it was “contemplating the acquisition of a controlling interest in a company in the insurance sector.”

The social security authority bought 56,6 million shares — 10 percent of Zimbabwe’s largest short-term insurer NicozDiamond’s total issued share capital — that were offloaded by a foreign investor at 2,75 cents on November 23, 2016.

Other major shareholders in NicozDiamond are Zimre Holdings Limited with 28,78 percent and Campbell with approximately five percent stake.

The pension fund reportedly purchased stakes held by LAG Malta belonging to foreign investor Noel Hayes (4,3 percent) and part of the stake held by Bruce Campbell who held just over 10 percent.

Nssa — which has 70 percent of its investments in the equities market with interests in 53 of the 60 companies listed on the ZSE, holding at least 10 percent shareholding in 12 counters — holds a controlling stake in FML followed by Capital Bank Corporation with 20,08 percent, LHG Malta Holdings and others with a combined 26,03 percent as at May 31, 2016.

The pension fund’s chairperson  Robin Vela, who also chairs the FML board, recently said Nssa was in for an investment overhaul and consolidation following various questionable investments made in the past.

“The board has previously noted its concern with Nssa’s historic poor investments and investment performance… but this is being rectified as the organisation consolidates operations.

“All investment decisions have been put to the test to ensure the authority meets its mandate to preserve value for stakeholders, generate acceptable income and deliver a living pension for members…” Vela said then.

With an investment expert in Nssa board’s investment committee, Vela explained that the authority was also examining companies on its portfolio with the view of strengthening them and “avoiding duplication.”

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