BUSINESS DAY: Fairfax bullish on SA and has cash to deploy

Fairfax Financial Holdings, a Canadian-based investment holdings business with predominantly insurance and reinsurance assets, says it has $500m to deploy in Africa.

The group, listed on the Toronto Stock Exchange and led by billionaire Prem Watsa, is also bullish on SA.

“We happen to be really quite optimistic about SA. We take a long-term view and we believe SA is uniquely positioned,” said Mark Cloutier, a Fairfax representative and incoming chairman of Bryte Insurance, formerly Zurich Insurance Company SA.

Fairfax raised the $500m in equity capital (housed under Fairfax Africa) via an initial public offer for subordinate voting shares, private placements and a commitment from its parent, Fairfax Financial.

Fairfax Africa would seek investments with a view to acquiring control or significant positions of influence, the group said. Its investment objective was to achieve long-term capital growth by investing in debt and equity instruments of businesses primarily conducted in Africa, it said.

Fairfax bought Bryte Insurance, the new brand of Zurich Insurance in SA and Botswana, from the Zurich Insurance Group in 2016 for R1.8bn. Also in SA, Fairfax has bought a 7.15% stake in reinsurer Africa Re and a 50% stake in specialist liability underwriter Camargue, through another of its subsidiaries, Brit Insurance.

Fairfax made its first investment in the country in 2014, when AgriGroupe Investments, in which it is the largest investor, acquired a 60% stake in agricultural and foods group Afgri.

Cloutier, who is executive chairman of Brit, said Fairfax was in “early-stage discussions” with two private insurance businesses in SA.

There was significant growth potential for insurance in the country as the transformation agenda progressed, he said.

Short-term insurers have struggled to grow premium income in a country with economic growth below 1%.

But Cloutier said the country would resemble other emerging markets from a demand standpoint, as people increasingly acquired assets that needed to be insured.

SA had a strong culture of insuring valuable assets, which was not the case in all countries, he said.

“We continue to make investments in SA and explore opportunities in the insurance and reinsurance worlds,” Cloutier said.

Watsa founded Fairfax in 1985, earning net insurance premiums of $10m that year. In 2015, it earned net premium income of $7.5bn.

Fairfax’s net earnings amounted to $642m in 2015, a 61% decline on the previous year due to larger losses from claims. Figures from September 2016 indicate that the company has a $44bn balance sheet.

Watsa — referred to as “Canada’s Warren Buffett” by the likes of Forbes, Irish Times and Financial Post — is adept in financial markets. He sold nearly $5bn in US Treasury bonds ahead of that country’s recent election, saving a lot of money, Forbes reported, as bond prices fell sharply on the news of Donald Trump’s election.

Giving Bryte its independence and “putting Fairfax’s financial strength behind it” would give the company an advantage in SA, Cloutier said.

De Jager to start first match for Vodacom Bulls

New signing Lood de Jager will make his first appearance for the Vodacom Bulls against the Chiefs in Brisbane on Thursday, after being named in the squad that face the New Zealand team in a Vodacom Super Rugby friendly at the Ballymore Stadium.

De Jager, who moved from the Toyota Cheetahs, will form a lock combination with RG Snyman in a team that will also see the return to Bulls colours for Jacques Potgieter, who won the Super Rugby title with the Waratahs a couple of years back.

Handré Pollard is also taking the field for the first time in more than a year and will lead the side, Jesse Kriel was named at fullback and Trevor Nyakane will start at tighthead in the match against the Chiefs.

“We don’t have much time left in the pre-season, so it will be important for certain combinations to work well in this match,” Vodacom Bulls coach, Nollis Marais, said.

“The Chiefs are a formidable team and this will be an important match to see where we are at this early in the season.”

The squad to take on the Chiefs is: Jesse Kriel, Travis Ismaiel, Dries Swanepoel, Burger Odendaal, Jamba Ulengo, Handre Pollard (c), Rudy Paige, Hanro Liebenberg, Jacques Potgieter, Nic de Jager, Lood de Jager, RG Snyman, Trevor Nyakane, Jaco Visagie, Pierre Schoeman. Bench: Edgar Maruthlule, Lizo Gqoboka, Jason Jenkins, Ruan Steenkamp, Piet van Zyl, Tian Schoeman, Warrick Gelant, John-Roy Jenkinson, Jacobie Adriaanse, Renaldo Bothma, Francois Brummer, JT Jackson.

East Africa recognises AFGRI’s contribution to food security

AFGRI Uganda was recognised by the East African people as the largest contributor towards food security at the annual East Africa Book of Records (EABR) awards.

At the handover ceremony recently held in Uganda, attended by members of AFGRI’s management team, EABR honoured AFGRI with the award for Responsible Consumption and Production in recognition of its sustainable contribution to agriculture in the region.

Jacob de Villiers, Managing Director, Grain Management at AFGRI, says the award proves that AFGRI’s initiatives to assist small scale farmers in the region are paying off.  “AFGRI’s Grain Management business in Uganda began in 2013 with the purpose of managing grain for food security and to prevent post-harvest losses on grain commodities.”

Across the African continent, AFGRI assists farmers to develop subsistence farms into semi-commercial farms in its efforts to ensure food security. AFGRI Grain Management in Uganda incorporates Farmer assistance and mentoring services, grain handling, grain storage and grain marketing.

The EABR aims to inspire ordinary people into doing extraordinary things in line with the United Nations Sustainable Development Goals. At the annual awards ceremony, the EABR recognises ground breaking achievements in various categories and records such achievement by awarding certificates to the winners. Companies in East Africa have been enthusiastic about the possibilities in harnessing the unique appeal of being a record breaker. Previous winners of the East African Award include the President of Uganda Yoweri Museveni and other distinguished individuals and companies.

At the 2017 ceremony, the awards were handed over by the Burundi Ambassador to Uganda standing in for the Speaker of Parliament, Honourable Rebecca Kadaga.

De Villiers concluded by saying that this is a tremendous accolade for AFGRI in support of its vision of being an enabler to food security across the continent.

Vodacom Bulls off to Brisbane

The Vodacom Bulls squad that will play the Chiefs in Brisbane and then contest the Brisbane Global Tens next weekend, has been named.

Flyhalf Handré Pollard will captain the squad and is set to make a return to the playing field after more than a year, with new signings, Johnny Kotze, Shaun Adendorff and Jacques Potgieter, also included in the squad.

The pre-season match against the Chiefs is at Ballymore Stadium in Brisbane on Thursday, 9 February.

At the Brisbane Global Tens, played at Suncorp Stadium on 11/12 February, the Vodacom Bulls have been grouped with the Brumbies and Highlanders and depending on results, either the Western Force, Hurricanes or Toulon.

“This will be an interesting trip for us, as we have not done this before,” said coach, Nollis Marais. “It does give us time together to work as a squad and that is very valuable, especially this time of our pre-season. The guys are keen to give it a go and we have a clear understanding of what we want to achieve on this trip.”

The squad is:

Warrick Gelant, Jade Stighling, Jamba Ulengo, Travis Ismaiel, Luther Obi, Burger Odendaal, Jesse Kriel, Johnny Kotze, JT Jackson, Dries Swanepoel, Francois Brummer, Handre Pollard (c), Tian Schoeman, Andre Warner, Ivan van Zyl, Piet van Zyl, Rudy Paige, Renaldo Bothma, HanroLiebenberg (v/c), Ruan Steenkamp, Shaun Adendorff, Nic de Jager, Jacques Potgieter, Jason Jenkins, Ruben van Heerden, RG Snyman, Lodewyk de Jager, Jacobie Adriaanse, John-Roy Jenkinson, Trevor Nyakane, Lizo Gqoboka, PierreSchoeman, Corniel Els, Edgar Marutllule, Jaco Visagie, Adriaan Strauss.