Sanlam (SLM) M&A announcement summary

Deal rationale and strategic fit

• Full ownership supports Vision 2030 and the fortress South Africa strategy, while enabling international expansion, ecosystem growth and closer coordination across the wider group.

• A simplified ownership and governance structure is expected to sharpen decisions, strengthen the investment narrative and consolidate listed entry points.

• Integrated insurance and financial-services offerings are intended to improve client coordination and cross-selling over time.

Financial terms and conditions

• Scheme offers R505 cash per eligible Santam share for the remaining shares, excluding treasury shares; the existing effective holding is ~63%.

• Offer premiums are 26.6% to the 2 October 2026 closing price, 25.0% to 30-day VWAP and 28.6% to 90-day VWAP; it exceeds the prior all-time high of R451.7.

• Fully funded all-cash consideration is backed by an irrevocable bank guarantee; financing is expected to include bridging finance, with leverage reviewed and reduced over time.

• EPS and ROE accretion are expected from year one; leverage is estimated at ~40% post-transaction, falling below 35% over the near term, with economic solvency within the 150%–190% target range.

• Dividend policy is unchanged, and the financing mix is targeted to maintain current credit ratings.

Synergies and expected cost savings

• Final cost synergies are expected from eliminating duplicated listing and associated governance expenses; management described additional cost savings as limited, with no savings figure stated.

• Existing procurement, IT, cybersecurity and platform sharing leaves limited additional cost savings to unlock.

• Revenue opportunities include cross-selling across insurance, life, asset management, banking and credit through broader distribution and ecosystem access.

• Closer coordination may streamline specialist insurance and reinsurance activity in Africa and improve reinsurance capital deployment over time.