Patrice Motsepe, Sanlam create one of SA’s largest BBBEE asset managers

Patrice Motsepe. Image credit: Flickr/GovernmentZA

Billionaire businessman Patrice Motsepe has partnered with financial services group Sanlam to establish one of South Africa’s largest Broad-Based Black Economic Empowerment (BBBEE) asset management companies.

In a statement on Thursday, Sanlam said it had signed agreements with Motsepe’s African Rainbow Capital Financial Services (ARC FS) to create the new company, subject to regulatory approvals.

25 percent of new company

Once the transaction is approved, ARC FS will own 25 percent of the new company at a purchasing price of R815.2 million. The stake will be held through Sanlam Investment Holdings (SIH), where Sanlam will own the remaining economic interest.

“The transaction will result in a combined direct and indirect black economic interest in SIH in excess of 51 percent in terms of the Amended Financial Sector Code,” Sanlam said in a separate note to investors.

The new asset management company is expected to focus on an extensive range of asset classes, “including South Africa’s leading index tracking business, Satrix.” The transaction is projected to take effect on 1 December, 2020.

Commenting on the deal, Motsepe said, “ARC FS, through its parent company Ubuntu-Botho Investments (UBI), has been Sanlam’s partner for more than 15 years. Over this period, both partners have created significant value for their respective shareholders, as well as for thousands of other stakeholders.

“With the latest transaction, I am of the firm belief that it will enhance Sanlam’s business as a serious contender in this highly competitive asset management space.”

Sanlam group CEO Paul Hanratty added, “The relationship between Sanlam and our partners continues to create value for Sanlam shareholders and the wider community that we serve in South Africa. This transaction takes Sanlam a step further on the journey to becoming South Africa’s leading asset manager.”

Sanlam has had a close relationship with Motsepe’s businesses and Foundation. In March, it partnered with the Motsepe Foundation, African Rainbow Capital (ARC) and African Rainbow Minerals (ARM) to pledge R1 billion towards South Africa’s fight against COVID-19.

Patrice Motsepe net worth

Patrice Motsepe net worth is estimated at $2 billion (around R34.5 billion in rands) as of 20 August, 2020, according to Forbes. He first became a billionaire in 2008.

He also holds a stake in Sanlam in addition to ownership of equity firm ARC, which has a significant stake in TymeBank, and ARM, which has interests in mining. His vast business interests extend to sports, where he is the president and owner of Mamelodi Sundowns football club.

In November 2019, Motsepe teamed up with billionaire Johann Rupert to take over 74 percent of Blue Bulls Company, which owns the Pretoria-based rugby franchise Blue Bulls.

Motsepe’s ARC and Rupert’s Remgro each own 37 percent, while the Blue Bulls Rugby Union (BBRU) now owns the remaining 26 percent.

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