British-American Investments Company

Britam Holdings Limited

Type	Public KN: BRIT
Industry	Insurance, Financial services
Founded	1965
Headquarters	Britam Centre, Upper Hill Nairobi, Kenya
Key people	Francis Muthaura Chairman of the Board Benson I. Wairegi Group Managing Director
Products	List Insurance Asset Management Property REITs Banking Holding
Revenue	KES: 20.69 billion (2014)
Operating income	KES: 14.74 billion (2014)
Net income	KES: 3,73 billion (2014)
Total assets	KES: 46.90 billion (2014)
Total equity	KES: 16.94 billion (2014)
Website	Homepage

Britam Holdings Limited, previously known by as British-American Investments Company, is a diversified financial services group and is listed on the Nairobi Securities Exchange. The group offers a wide range of financial products and services in insurance, asset management, property, and banking in the African Great Lakes region.

Overview

Britam's headquarters are in Nairobi, Kenya, with subsidiaries in Kenya, Uganda, South Sudan, Rwanda, Tanzania, Malawi, and Mozambique. The flagship company of the group is the British-American Insurance Company (Kenya) Limited, commonly referred to by its brand name Britam Kenya.^[1]

According to the Insurance Regulatory Authority report released in September 2014, Britam Kenya was ranked second in market share with 11.2 percent of the market behind Jubilee Insurance Company of Kenya, which controlled 11.9 percent.^[2]

History

1965-1999

The group's operations commenced in Kenya in 1965 with the opening of the first office in Nairobi as a foreign branch of British-American Insurance Company Limited, headquartered in the Bahamas. A local company was incorporated on 14 November 1979 as British-American Insurance Company (Kenya) Limited under the Companies Act as a private limited liability company following a government directive that all branches of foreign owned insurance companies must be incorporated locally. By this time, the Company had established nine branches across Kenya. This local incorporation represented the first step in the localisation of the Company. In 1984, local Kenyan investors acquired 33.33 percent of the shareholding in line with government directives.^[1]

2000-2009

In 2004, the group incorporated British-American Asset Managers whose core business was the provision of Investment advisory and Fund management services. The company offers investment funds, structured as Unit trusts and discretionary Portfolio management, to both institutions and private clients. During the same year, the group restructured, creating a non-operating holding company.^[1] Also in 2004, Britam acquired a strategic equity stake in the Equity Group Holdings Limited. Britam made its first equity acquisition in Housing Finance Company of Kenya (the largest mortgage finance provider in East Africa) in 2007.^[3]

2010-To date

2010 marked Britam's regional expansion commencing with the group's expansion into Uganda with the incorporation of Britam Insurance Company (Uganda) Limited, which commenced business on 24 November 2010, following the issuance of an insurance license by the Uganda Insurance Commission.^[4]

In 2011, the shares of British-American Investments Company were listed on the Nairobi Securities Exchange through an under-subscribed Initial Public Offering. This was largely the result of risk-averse foreign investors shunning the IPO because of the Eurozone crisis and a sluggish U.S economy.^[5] Britam Insurance Company (South Sudan) Limited was incorporated in February 2012 and is licensed to underwrite all classes of life and non-life insurance.^[6] In Rwanda, Britam Insurance Company (Rwanda) Limited, was incorporated and licensed in 2013 by the National Bank of Rwanda.^[7][8]

On 9 December 2013, the British-American Investments Company entered into a definitive Share Purchase Agreement with Royal Ngao Holdings to acquire its 99 percent shareholding in Real Insurance Company Limited, a deal that was valued at KSh1.4 billion (approximately US$16 million then). 60% of the sales price was paid in cash and 40% was paid by issuance of new shares in British-American Investments Company. Real Insurance was licensed insurer carrying out General insurance business in Kenya, Tanzania, Malawi, and Mozambique. It had been a player in the Kenyan insurance sector since 1910.^[9] This transaction led to the expansion of Britam to Tanzania, Malawi, and Mozambique. Britam and Real Insurance only had parallel insurance businesses in Kenya. The Kenyan businesses would be consolidated. The acquisition of Real Insurance was approved by the shareholders of Britam on 19 February 2014.^[10]

In April 2014, the group announced its intention to acquire 30 percent of Continental Re Kenya Limited, a fully owned subsidiary of Lagos-based Continental Reinsurance Plc., in a deal valued at KSh300 million (approximately US$3.4 million). This acquisition was in a bid for the group to consolidate its market share and broaden revenue sources.^[11] The acquisition will be funded by a planned bond issue.^[12]

On 30 June 2014, British-American Investments Company served a takeover notice on the board of directors of the Housing Finance Company of Kenya to acquire the 24.76 percent shareholding that Equity Group Holdings Limited (EBG) held in the mortgage lender at that time.^[13] This transaction was completed on 31 December 2014 and it increased Britam's stake in Housing Finance to 46.1 percent.^[14]

In June 2015, the shareholders adopted a resolution to change the company name from British-American Investments Company to Britam Holdings Limited.^[15]

Subsidiaries and investments

The companies that compose the Britam Holdings Limited are organised into four divisions and include, but are not limited, to the following:

Insurance

• British-American Insurance Company (Kenya) Limited (Britam Kenya) – Nairobi, Kenya – 100% Shareholding – The flagship company of the group. Offering General insurance and Life insurance.
• Real Insurance Company Limited – Nairobi, Kenya – 99% Shareholding – Offering General Insurance and Holding Company for Tanzania, Malawi and Mozambique subsidiaries. Real Insurance Company is the oldest member having been founded in 1910 as a subsidiary of Royal Insurance, now part of RSA Insurance Group.
• Britam Insurance Uganda Limited – Kampala, Uganda – 100% Shareholding – Offering General and Life Insurance.
• Britam Insurance South Sudan Limited – Juba, South Sudan – 100% Shareholding – Offering General and Life Insurance.
• Britam Insurance Rwanda Limited – Kigali, Rwanda – 100% Shareholding – Offering General Insurance.
• RICEA Management Services Company – Nicosia, Cyprus – 100% Shareholding^[16] – Held through Real Insurance Company Limited – Management services of the Real Insurance subsidiaries.
• Real Insurance Company of Tanzania Limited – Dar es Salaam, Tanzania – 54.45% Shareholding – Held through Real Insurance Company Limited – Offering General Insurance
• Real Insurance Company of Malawi Limited – Blantyre, Malawi – 64.35% Shareholding^[17] – Held through Real Insurance Company Limited – Offering General Insurance. Started operating in 1959, making it the oldest insurance company in Malawi. It was listed on the Malawi Stock Exchange on 29 September 2008 through a successful IPO that was over-subscribed by 300%. It is the only listed insurance company in Malawi.^[18]
• Royal Insurance Company of Mozambique SA (Real Comphania de suguros de Mozambique) – Maputo, Mozambique – 97.02% Shareholding – Offering General Insurance

Asset Management

• British-American Asset Managers (BAAM) Kenya Limited – Nairobi, Kenya – 100% Shareholding – Offering Financial services, investment management, Private equity and Investment advisory services.
• British-American Asset Managers (BAAM) Uganda Limited – Kampala, Uganda – 100% Shareholding – Offering financial services, investment management and investment advisory services.

Property

• Bramer Properties Limited – Nairobi, Kenya – 100% Shareholding – Real Estate and REITs.

Banking Holding

• Equity Group Holdings Limited – Nairobi, Kenya – 10.1% Shareholding - A financial services organisation in East Africa regulated by the Central Bank of Kenya.
• Housing Finance Company of Kenya - 46.1% Shareholding - A mortgage finance provider in Kenya regulated by the Central Bank of Kenya.

Ownership

The shares of the stock of Britam Holdings Limited are traded on the Nairobi Stock Exchange, under the symbol: BRIT. After the conclusion of the Real Insurance acquisition, the shareholding in the group's stock was as depicted in the table below:^[19]

Britam Holdings Limited Stock Ownership

Rank	Name of Owner	Percentage Ownership
1	British-American Kenya Holdings Limited	23.34
2	Equity Holdings Limited	20.84
3	Jimnah M. Mbaru	10.28
4	Benson I. Wairegi	5.17
5	Kenya Commercial Bank Nominee A/C 915	4.72
6	Peter Munga	3.87
7	James Mwangi	3.87
8	Co-operative Bank Custody A/C 4012	3.10
9	Filimbi Limited	3.02
10	Royal Ngao Holdings Limited	2.42
11	Other Local & International Investors	19.37
	Total	100.00

Governance

British-American Investments Company is governed by an eleven-person Board of Directors with Francis Muthaura serving as the Chairman of the group and Benson I. Wairegi as the CEO.

Britam Tower

Britam Tower is a 31 storey building under construction in Upper Hill, Nairobi and when completed, its projected to be the tallest building in Kenya and the third tallest in Africa. The tower's construction began in October 2013^[19] and is set to cost in excess of US$70 Million. The tower is set to have wind turbines that would generate power for parts of the building. The complex will comprise offices, banking halls, restaurants and retail stores.^[20]

Controversies

Bramer Banking Corporation Scandal

In April 2015, a US$693 million Ponzi scheme in Bramer Banking Corporation hit Britam's largest shareholder British American Investment Company Mauritius Limited (BAIC).^[21][22] The Group moved swiftly to inform the public that the ponzi scheme did not affect their operations.^[23] However, the director were put under investigation by the IRA.^[24] The Mauritian government appointed receiver managers at BAI Co. later announced their intention to dispose off the group's entire shareholding in Britam.^[25] Dawood Rawat however moved to court in France to block this sale.

See also

• Equity Group Holdings Limited
• HF Group
• Dyer & Blair
• NSE
• Kenya Insurances
• Uganda Insurances
• British American Investment Company (Mauritius)
• Bramer Banking Corporation

References

1. Britam, . (29 June 2011). "British-American Investments Company IPO Prospectus" (PDF). British-American Investments Company (Britam). Retrieved 30 November 2014.
2. Herbling, David (21 December 2014). "CIC rises past ICEA to be third-largest insurance firm". Business Daily Africa. Nation Media Group. Retrieved 22 December 2014.
3. "British-American Investments Company Shareholders Circular of 24 January 2014, Pages 26 & 27" (PDF). British-American Investments Company. 24 January 2014. Retrieved 30 November 2014.
4. Ainomugisha, Lydia (20 July 2011). "Britam Insurance Enters Uganda". The Observer (Uganda). Retrieved 30 November 2014.
5. Gachenge, Beatrice (23 August 2011). "Kenya's British-American IPO Undersubscribed". Reuters. Retrieved 30 November 2014.
6. Mutegi, Mugambi (8 March 2012). "CFC & British American To Open Shop In South Sudan". Business Daily Africa (Nairobi). Retrieved 30 November 2014.
7. BNR, . "National Bank of Rwanda: Licensed Private Insurers In Rwanda". National Bank of Rwanda (BNR). Retrieved 30 November 2014.
8. Editor, . (30 July 2013). "International Insurance Firm Opens In Rwanda". RwandaPost.Org Quoting Rwanda Eye. Retrieved 30 November 2014.
9. Mugwe, David (24 November 2013). "Britam To Buy Real Insurance In A Share Deal". Business Daily Africa (Nairobi). Retrieved 30 November 2014.
10. Wachira, Charles (20 February 2014). "Britam Kenya Shareholders Approve Acquisition of Real Insurance". Bloomberg News. Retrieved 30 November 2014.
11. Herbling, David (14 April 2014). "Britam Seeks KSh300 Million Stake In Nigerian Firm". Business Daily Africa (Nairobi). Retrieved 30 November 2014.
12. Gachiri, John (21 May 2014). "Britam Eyes Bond In Expansion Drive". Business Daily Africa. Retrieved 30 November 2014.
13. Masinde, Joshua (30 June 2014). "Equity Bank Exits Housing Finance Through Sale of Its Shares To Britam". Daily Nation (Nairobi). Retrieved 30 November 2014.
14. Paul Richardson, and Eric Ombok (1 July 2014). "Britam of Kenya to Buy Equity Bank’s Housing Finance Stake". Bloomberg News. Retrieved 30 November 2014.
15. "Britam name change". Britam Holdings Limited. 2015-06-26. Retrieved 2015-07-06.
16. RICL, . (March 2013). "Real Insurance 31 December 2012 Annual Report" (PDF). Real Insurance Company Limited (RICL). Retrieved 30 November 2014.
17. RICML, . (March 2010). "Real Insurance Company of Malawi Limited 2009 Annual Report" (PDF). Real Insurance Company of Malawi Limited (RICML). Retrieved 30 November 2014.
18. Helema, Innocent (11 August 2014). "Britam & Real Complete Deal". The Nation (Malawi). Retrieved 30 November 2014.
19. "Britam Holdings Limited - 2014 Annual Report" (PDF). Britam Holdings Limited. 2014-12-31. Retrieved 2015-07-06.
20. "Britam Tower". Britam Holdings Limited. Retrieved 2015-11-10.
21. Maglich, Jordan D. (2015-04-03). "Mauritius Halts $693 Million Ponzi Scheme At Bank". http://www.ponzitracker.com/. Ponzi Tracker. Retrieved 2015-04-09. External link in |website= (help)
22. AROUFF, Jean Paul (2015-04-03). "Mauritius revokes Bramer Bank licence, PM says Ponzi scheme found". Reuters. Thomson Reuters. Retrieved 2015-04-09.
23. Wachira, Charles (7 April 2015). "Britam of Kenya Says It’s Separate From Suspended Mauritian Bank". Bloomberg Business. Bloomberg L.P. Retrieved 7 April 2015.
24. Mutegi, Mugambi (2015-04-20). "IRA probes Britam directors over Bramer bank scandal". Business Daily Africa. Nation Media Group. Retrieved 2015-04-21.
25. Richardson, Paul (2015-06-18). "Britam of Kenya’s Biggest Holder Has Stake Put Up for Sale". Bloomberg Business. Bloomberg L.P. Retrieved 2015-06-18.

External links

• Britam Kenya Homepage
• Britam Uganda Homepage
• Britam Rwanda Homepage
• British American Investment Co. (Mtius) Ltd