Sanlam Kenya PLC’s Board of Directors has formally initiated its rights issue, following the successful acquisition of all necessary regulatory approvals from shareholders, the Capital Markets Authority (CMA), the Nairobi Securities Exchange (NSE), and the Insurance Regulatory Authority (IRA).
This capital raising is strategically designed to substantially reduce the company’s existing long-term debt obligations and provide management with enhanced operational and financial flexibility to underpin future growth initiatives and a return to sustained profitability.
This action aligns with Sanlam Kenya’s overarching objective of lowering the group’s debt to a manageable and sustainable level, thereby strengthening its financial position.
The Sanlam Kenya rights issue entails the offering of up to 500,000,000 new ordinary shares, each priced at Kshs 5.0. If fully subscribed, this initiative is projected to generate gross proceeds of Kshs 2.5 billion.
The offer price of Kshs 5.0 per new share represents a 20.9% discount relative to the six-month volume-weighted average share price of Kshs 6.3 as of April 3rd, 2025. This pricing strategy provides a clear financial incentive for existing shareholders to participate in the rights issue.
Eligible shareholders will be entitled to acquire 125 new shares for every 36 existing ordinary shares held as of the designated record date.
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Sanlam Kenya Rights Issue Summary |
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| Data | Statistic |
| Par value | Kshs 5.0 each |
| Offer value | Kshs 5.0 per share |
| Total Number of outstanding shares prior to the rights issue | 144,000,000 |
| Number of new shares | 500,000,000 |
| Total Number of outstanding shares after the rights issue | 644,000,000 |
| Gross proceeds of Rights Issue assuming full subscription | 2,500,000,000 |
Source: Sanlam Kenya
The rights issue has been fully underwritten by Sanlam’s parent entity, Sanlam Allianz Africa, which has irrevocably committed to purchasing any rights and subsequent new shares that remain unsubscribed by eligible shareholders after the initial allocation period.
Use of Proceeds and Debt Reduction Strategy
The net proceeds from this rights issue will be allocated towards several key priorities integral to Sanlam Kenya’s long-term strategic objectives.
The primary focus will be on significantly reducing the group’s current long-term debt levels, which were notably elevated before this initiative, and on bolstering the company’s path back to consistent profitability.
Before the rights issue, Sanlam Kenya’s debt-to-equity ratio stood at 19.4, representing the highest leverage among its direct peer insurance companies in Kenya.
Following the successful completion of the rights issue, Sanlam Kenya’s pro forma debt-to-equity ratio is projected to decrease substantially by 59.3% to 7.9, reflecting the significant decline in its absolute debt level.
Sanlam Kenya’s largest shareholder, Hubris Holdings Limited, which directly controls a significant 57.1% stake, has formally committed to fully subscribing to its proportionate entitlement in the rights issue.
Furthermore, other major shareholders have conveyed their support for the transaction, indicating a strong anticipated level of overall subscription.
