Sanlam Hopes to Make Nigerian Footprint

March 12 - Analysts believe that Sanlam, South Africa's second largest insurance group, will be partnering with a Nigerian bank to break into the African country by the end of this year.

The Chief Executive of Sanlam, Johan van Zyl, confirmed that the insurance group hopes to sign its first policy in Nigeria this year, but would not name the new Nigerian partner just yet.

He promised that the name would be made public within a few months.

Sanlam, which received an operating license to offer its services in Nigeria's life insurance market, confirmed that the new partner was not an insurance group, leading analysts to believe that it has joined with a local bank.

Van Zyl said that Sanlam had always seen Africa as a key in the company's growth. "The Nigerian development is the beginning of a plan to spread our footprint on the continent," he said. "We are going to expand to Africa by adding new things like health. There is a blue sky going forward."

Van Zyl spoke of the challenges of entering the African market, including the fact that even though some local companies were cheap enough to acquire, they were nevertheless "stressed with no earnings."

"It will take us a lot of effort to turn them around," he said.

It is believed that the latest venture will set Sanlam back around R48 million in the first three years.

Sanlam is certainly not the only South African insurance group to venture out of the boundaries of the country and expand further into Africa.

Standard Bank, Blue Financial Services and Metropolitan have all made footprints in other local markets.

Sanlam said that it was also investigating possibilities in Uganda.