Softlogic gets Rs 1.8 bn from sale of 38% stake in Asian Alliance Insurance
View(s):By Duruthu Edirimuni Chandrasekera
Softlogic Holdings and Softlogic Capital, subsidiaries of Softlogic Group will get Rs 1.8 billion from their planned part sale in Asian Alliance Insurance to DEG – Deutsche Investitions Capital – Und Entwicklungsgesellschaft MBH of Germany and FMO – Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden N.V. of Netherlands, officials said.
“Softlogic Holdings plans to sell its entire 18 per cent in Asian Alliance Insurance PLC (AAI) and Softlogic Capital also will also sell a similar stake, but they will retain 57 per cent,” Ashok Pathirage, Chairman Softlogic and Asian Alliance Insurance PLC told the Business Times on the sidelines of announcing the agreement between the three parties which will be concluded early next year.
Asian Alliance Insurance undertakes both Life and General Insurance business. The company became a part of the Softlogic Group during the latter part of 2011. The value proposition being created in general insurance has seen the doubling of revenue compared to the previous year with exciting prospects to be realized in health insurance with the Asiri Group of Hospitals owned by the Softlogic Group, and distribution of insurance solutions via the Softlogic Retail network of over 150 stores throughout the length and breadth of Sri Lanka.
Mr. Pathirage said that this partnership is a comprehensive insurance proposition as Sri Lanka confidently moves towards US$ 4,000 per capita in 2016, thereby providing significant opportunities in the insurance arena. This partnership will be of tremendous benefit to all stakeholders, particularly since it will enable the company to access international expertise and strategy.
Michael Bornmann, Member of DEG’s Management Board, commenting on the signing, said “We are convinced that post-conflict Sri Lanka has immense scope and feel that the insurance industry has great prospects in the medium term. We expect the strong economy to deliver higher disposable incomes that in turn will lead to significant demand for financial services, including insurance. We are proud of our combined DEG / FMO partnership with the Softlogic Group which strives to create outstanding value in a number of areas.”
Nanno Kleiterp , CEO of FMO said, “We are pleased to be part of this financing , enabling further growth of life insurance penetration in Sri Lanka. We look forward to continue our relationship with the Softlogic Group in creating opportunities for financial services products and services that will facilitate sustainable and inclusive growth”.
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