Old Mutual Holdings Plc has divested from the Tanzanian short-term insurance market by selling its subsidiary, Insurance Tanzania, for Sh73.5 million. The decision, driven by the unit’s underperformance and failure to meet expected returns, reflects a strategic move despite Old Mutual’s continued focus on expanding across East Africa.
Acquired in 2015, UAP Insurance Tanzania struggled with weak financial metrics, prompting Old Mutual to sell the unit at a discount based on its net assets at the end of 2023, valuing it at Sh122.5 million. Despite narrowing its losses in 2023, UAP Insurance Tanzania faced challenges with negative net revenues from insurance services expenses.
Old Mutual remains committed to growth in East Africa, emphasizing collaborations with local entities to offer its products and services. This strategic shift aligns with the company’s broader strategy to enhance its presence in key markets like Uganda and South Sudan through subsidiaries such as UAP Old Mutual Insurance Uganda Limited and UAP Properties Limited (South Sudan).
In 2023, Old Mutual’s financial performance showed improvement, narrowing its overall loss to Sh113.8 million compared to Sh2.2 billion in 2022, driven by increased insurance revenues and investment income, despite higher operating expenses.
