Muscat: With common interests to further broaden and strengthen its regional insurance business, National Life & General Insurance Company (NLGIC) – a subsidiary of Oman International Development and Investment Company (Ominvest) – has entered a strategic transaction to acquire 100 per cent shareholding in Royal Sun Alliance (RSA) the Middle East.
NLGIC will execute the transaction in two parts: (i) purchasing 50.00002 per cent shareholding in RSA Middle East from Sun Alliance Insurance Overseas LTD (SAIO), a fully-owned entity of Royal & Sun Alliance Insurance Limited; and (ii) exchanging the remaining shares of RSA Middle East, owned by reputable Saudi shareholders, with new issued NLGIC’s shares, thus making the Saudi shareholders collectively the second-largest Shareholders in NLGIC after Ominvest. The transaction is subject to approvals from the respective regulators and NLGIC’s shareholders.
The agreements have been based on a deep understanding of RSA’s business legacy and capabilities, and on the efficient utilisation of NLGIC’s know-how and financial position, aiming to transform the combined entity into a larger, stronger, and more competitive regional insurance player emerging from the Sultanate of Oman.
Describing Ominvest’s investment philosophy, Khalid Muhammad Al Zubair, Chairman of Ominvest and NLGIC said, “Our investment philosophy at Ominvest has always been to support and enable our portfolio companies to thrive and grow. Ominvest has a strong track record of building businesses in the insurance sector. Our largest insurance subsidiary, NLGIC, has remarkably grown locally and regionally. NLGIC’s success is attributable to the significant capital injection from Ominvest, prudent oversight by its Board, and smart business strategies implemented by the management. We endeavour to work closely with our companies’ boards and management teams to identify, screen, and capitalise on growth opportunities. We provide strategic direction and help our companies draw ultimate roadmaps that would create value for all stakeholders.”
He added, “With this transaction, we look forward to a brighter and stronger future for our insurance business, having a much bigger impact across the region. Moreover, the transaction will bring foreign direct investment to Oman-based NLGIC.”
On behalf of RSA Middle East shareholders, Adnan Bogary, Chairman of RSA Middle East said, “Health insurance has been considered a major growth opportunity for RSA Middle East, as it is the fastest-growing product line and by far the largest when compared to non-life and life insurance. To tap into that, we needed a partner with experience in the health space and deep knowledge of the Middle East region.” He added, “This strategic agreement will foster a strong partnership between NLGIC and our RSA Middle East shareholders and will pave the way for developing a diversified portfolio, as well as regional scale-up. We look forward to taking this business to new heights with our new partners.”
Given RSA Middle East’s strong customer base and solid business track record in the region, the transaction will help NLGIC grow its insurance business by optimizing operations in the Sultanate of Oman and the United Arab Emirates while gaining access to a larger market in the Kingdom of Saudi Arabia. The combined business of NLGIC and RSA Middle East will create incremental value for all stakeholders. In addition, it will create a full-fledge well-diversified insurance player, offering a broad array of insurance products and services to individual and corporate customers in Oman, KSA, UAE, Kuwait, and Bahrain.
The agreement will help both entities reach new markets, seek top-line growth opportunities, rationalise costs, cross-sell products, implement top-notch technologies and innovations, and complement each other’s business offerings in the region, which will add tremendous value to the customers and fuel business growth. The transaction is expected to be completed swiftly post relevant approvals.
