South African short-term insurer Santam has finalised a purchase agreement with Sanlam Life Insurance for the acquisition of a 60% stake in NMS Insurance Services (NMSIS), the insurance division of MultiChoice Group (MCG).  

Santam will buy the majority of the A1 Ordinary Shares, which are linked to general insurance products, with an initial cash payment of R925m ($51.2m). 

NMSIS, a registered micro-insurer in South Africa, is authorised to provide both general and life insurance.  

For two decades, it has been offering insurance under the DStv brand, including cover for devices, installations and various waiver products.  

The acquisition is said to align with Santam’s strategy to broaden its market reach, particularly by cross-selling to MultiChoice’s substantial South African subscriber base, estimated at eight million clients. 

In June this year, Sanlam acquired a 60% shareholding in NMSIS, which includes two classes of shares.  

The Ordinary Shares pertain to life insurance distributions, while the A1 Ordinary Shares, now largely owned by Santam, are tied to general insurance distributions.  

Santam’s Partner Solutions CEO Gloria Tapon Njamo said: “With a base of approximately eight million subscribers in South Africa, MultiChoice provides a robust and scalable channel for Santam to distribute tailored general insurance products. 

“At Santam we will leverage our experience in device insurance to increase the penetration of related general insurance products into the MultiChoice subscriber base.  

“MultiChoice’s integrated payments platform has the potential to present a solid foundation for offering affordable value-added general insurance products to drive our passion for advancing financial inclusion sustainably through frictionless bundling of payments for services.”  

Santam will utilise its current cash reserves to finance the acquisition amount.