VENTURES AFRICA – Old Mutual Plc., the U.K.’s third- largest insurer by market value, has revealed plans to start operations in Nigeria before the end of this year, Group Finance Director Philip Broadley said.
According to Broadley, plans are underway to acquire Nigeria’s Oceanic Life, a unit of Togo’s Ecobank Transnational Inc., this year in a move that put Old Mutual in a favourable position in the West African nation and neighbouring Ghana, which are the countries with the continent’s highest growth potential.
Broadley disclosed that the company’s current focus is on being able to start its Nigerian operations before it looks beyond Africa’s second largest economy. “Nigeria will be a new operation if we go ahead and complete the transaction”, he said.
Old Mutual has 1.2 million customers in Namibia, Zimbabwe, Kenya, Swaziland, Malawi and Botswana, and 3.3 million in South Africa, sub-Saharan Africa’s largest economy. African operations excluding South Africa earned 3 percent of Old Mutual’s 994 million pounds ($1.56 billion) of pretax profit in 2011.
South Africa made 5.84 billion rand ($715.6 million) in the same period.
According to statement by Broadley, Old Mutual is set to boost share of profit from African operations to the equivalent of 10 percent of its South African pretax profit this year, and 15 percent by 2015.
“We will grow our business in Africa as fast as the market demands it,” Broadley said. “That is, as fast as we find customers that have the money for our products.”
Last month, the World Bank’s global economic prospects report estimated economic growth in sub-Saharan Africa at 5 percent in 2012 and 5.3 percent in 2013 compared with 4.7 percent last year.