South Africa’s fast-growing wills and estates administrator Capital Legacy and Sanlam announced today that they are joining forces by creating a compelling wills, estates and trusts business together.
The transaction is subject to regulatory approval.
The deal will see Sanlam Life Insurance (Sanlam Life) sell its trust business, Sanlam Trust, to Capital Legacy and Sanlam Life acquiring a 26% interest in the enlarged Capital Legacy Group that includes the Sanlam Trust business following completion of the transaction.
Capital Legacy intends acquiring full ownership and control of Sanlam Trust for an amount of R390 million.
Sanlam Trust will continue to operate under the trusted and market-recognised Sanlam brand to service the Sanlam customer base and its various distribution channels.
Sanlam Life, for its part, will subscribe for a 26% shareholding in Capital Legacy Group (that includes Sanlam Trust) for a total consideration of R1.11 billion
The merged entity will be managed by Capital Legacy, while leveraging the strengths of both companies.
Sanlam sees the investment into the new combined business as a strategic move to benefit from a business with significant growth opportunities going forward.
“We believe that proper estate planning and drawing up a will are key components in financial planning,” Anton Gildenhuys, CEO of SA Retail Affluent at Sanlam, says:.
“We admire the innovative solutions that Capital Legacy created, the agile and best in class technology, as well as the comprehensive marketing infrastructure that they have built – all of which supported phenomenal growth. Combining the market leading capabilities in Sanlam Trust with those at Capital Legacy will truly create a brilliant organisation that will be able to assist all South Africans to live with confidence.”
Capital Legacy and Sanlam Trust operations will be merged, leveraging the Capital Legacy innovations that have made it the innovator and pathfinder in the wills and estates market in South Africa; and taking this value proposition even further by leveraging Sanlam’s extensive distribution capabilities and customer base under the Sanlam brand.
With this transaction, Sanlam will become one of three significant shareholders in Capital Legacy, with African Rainbow Capital at 25.8% and Capital Legacy’s founder, Alex Simeonides, through a trust, retaining a circ.27% shareholding.
The management owners of Capital Legacy will remain shareholders and continue to run the enlarged business together with the management team of Sanlam Trust. With a shareholding of 26%, Sanlam Life will be entitled to appoint two directors to the board of Capital Legacy with a mandate to help unlock the envisaged growth opportunities together with the Capital Legacy management team.
“The deal has been a year in the making and it is important to note in these economic times that it is driven by the realisation of mutually beneficial growth opportunities and not cost rationalisation. We believe it will have a positive impact on the market to the benefit of customers and I am excited about what the future holds…”, says Capital Legacy CEO and founder, Alex Simeonides
Capital Legacy is a fast-growing financial services business in SA with its wills and estates offering packaged into the unique Legacy Protection Plan.
Capital Legacy was founded in 2012 and since then consistently delivers value to customers, resulting in the company drafting almost 600 000 wills to date, making it a formidable wills and estates administrator in South Africa and a fast-growing financial services business. Whereas the company started out with a staff complement of six, it now has more than 1 000 staff dedicated to delivering its promise of ‘making the loss of a loved one easier’.
Sanlam Trust is a strong fiduciary business and comprises several businesses lines including wills, estates, trusts and beneficiary funds. The business is well respected by the industry and its people are highly regarded.
The parties saw strengths in each other’s fiduciary operations that, when combined, will unlock value to both companies’ offerings and make quality wills and estates services more accessible in SA, in line with Capital Legacy’s mission.
