Liberty in Talks to Sell Businesses to Focus on South Africa

JOHANNESBURG (Capital Markets in AfricaA) – Liberty Holdings Ltd. is in talks to sell majority stakes in its health-insurance business as well as its asset-management operations in East and West Africa as the Johannesburg-based firm focuses on its home market.

The firm’s property and casualty insurance units in Malawi and Namibia are also up for grabs as Chief Executive Officer David Munro pushes ahead with his plans to simplify the company, improve profitability and win back market share. The strategy of focusing on South Africa is starting to bear fruit, with improvements in the local units helping to boost new sales, lift margins and operating profit.

Liberty wants to dispose of large stakes in its money-losing assets or find strategic partners, Munro said by phone Thursday. It has already agreed to sell its short-term insurance-technology platform to Standard Bank Group Ltd., the insurer and money manager’s parent, for 145 million rand ($10 million).

It will still focus on future growth engines in southern Africa, which includes insurance and its Stanlib asset-management units, “to make sure that they are capable of reaching their potential,” the CEO said. The corporate business is on the right path, Munro said.

Full-year profit missed analyst estimates, weighed down by a drop in earnings at its South African retail business, its corporate unit and LibFin, which manages Liberty’s market, credit and liquidity risks. Adjusted earnings per share fell 17 percent to 8.18 rand, the company said in a statement, compared with a 10.20 rand average estimate.

The stock was little changed at 103 rand as of 10:23 a.m., paring an earlier decline of as much as 3.9 percent.

Source: Bloomberg Business News