AXA in €198m Nigerian insurance deal

The French insurer will acquire a controlling stake in Mansard, the country’s fourth insurance provider

French insurer AXA Group has agreed to acquire a controlling stake in Nigeria’s fourth leading insurer, according to a statement from the company.

AXA, which has 157,000 employees serving 102 million clients across 56 countries, will acquire 100 percent of Assur Africa Holdings – a consortium led by private equity firms AfricInvest and Development Partners International, and European development finance institutions DEG, FMO and Proparco – which in turn holds a 77 percent stake in Mansard Insurance, for €198 million.

AfricInvest and DPI declined to comment on the financial details of the transaction.

Mansard has operations in both the property and casualty and the life and savings markets. Its commercial lines represent almost two thirds of its revenues, and its retail business has achieved growth of around 40 percent per year on average over the past three years.

“This acquisition is a unique opportunity for AXA to enter the largest African economy with leading positions in all business lines and to get exposure to the fast-growing Nigerian retail insurance market,” AXA deputy chief executive officer Denis Duverne said in a statement.

AXA is a limited partner in profit-with-purpose investor LeapFrog Investments’ second fund, which closed on its target and hard-cap of $400 million in September. The fund, which has a focus on the financial services sector, will be making equity investments of between $10 million and $50 million in South Africa, Kenya, Ghana, Nigeria, India, Sri Lanka, Indonesia and the Philippines.

DPI invested an undisclosed amount in the consortium using capital from ADP I, a 2007-vintage €270.4 million vehicle. A source with knowledge of the transaction indicated that the firm tripled its initial investment on exit.

“Our investment in Mansard fits our core investment objective to invest in best-in-class African companies that benefit from the emerging middle class,” DPI chief executive officer Runa Alam said in a statement. “We are delighted to have achieved such strong equity returns for our ADP I investors.”

DPI will be keen to return capital to investors as it continues to raise its second fund. The firm launched ADP II, which is targeting $500 million, in 2012, and is understood to have held a first close on $250 million in July 2013.

AfricInvest first backed the consortium in 2006 from AfricInvest Ltd, a 2004-vintage vehicle which closed on €34 million, according to data from PEI’s Research and Analytics division. The firm then made further investments in 2011 rfom AfricInvest II and AfricInvest Financial Sector, a 2007-vinatge €60 million vehicle. AfricInvest held a first close on its AfricInvest III earlier this month on €154 million. The vehicle is targeting €200 million.