Prudential Plc invests in Nigeria, extends bancassurance partnership with Zenith Bank

Prudential plc has reached an agreement to acquire the remaining shares of Prudential Zenith Life Insurance Limited (PZL), its joint venture business in Nigeria.

PZL has existing bancassurance partnerships with Zenith Bank in Nigeria and Ghana.

Zenith Bank is a leading bank headquartered in Nigeria, with a network of over 400 branches and approximately 29 million customers across the region.

The increase in ownership of the PZL business is a further step in executing Prudential’s focus in Africa on deploying capital in its existing operations that have the greatest potential. Prudential originally purchased a 51% stake in Zenith Life Insurance Limited in Nigeria in 2017, which benefited from an existing bancassurance partnership with Zenith Bank. The consideration for this transaction will be payable in cash and includes a performance-based element.

Commenting on the deal, Solmaz Altin, Managing Director, Strategic Business Group, Prudential said: “We are delighted to take full ownership of the business and have the opportunity to better serve the needs of our customers and create long-term value for our shareholders. Acquiring the remaining stake is consistent with our new strategy to build a sustainable multi-channel growth platform, through targeted investment in structural growth markets across Asia and Africa. We see substantial long-term opportunities in Nigeria and plan to build on our existing agents, bancassurance partnerships and direct distribution capabilities.

“PZL is a great business and one we know well, and our relationship with Zenith Bank further strengthens our distribution capabilities in the region.”

Emmanuel Aryee Mokobi, CEO, Africa, Prudential said: “This transaction increases our participation in an attractive market with significant growth potential.

“Insurance penetration remains low in Nigeria (less than 0.2% of GDP) and there is a significant growth runway. Nigeria’s life insurance market is the fifth largest African market with a gross written premium of US$770 million, and we have an established presence there.

“Prudential Africa’s strategy is to focus on building its presence and investing in growth and scale in our chosen insurance markets in Africa. The Nigerian business is profitable, and the acquisition of the remaining stake will allow us to realise the full potential of the platform by implementing initiatives in areas such as customer, technology-powered distribution and health.”

Nigeria is the largest economy in Africa, with a GDP of US$477 billion as at 2022[1] and a population of 218 million people. Its population is fast growing and is expected to increase to over 370 million by 2050[2], by which time Nigeria is expected to be the third most populous country in the world (currently 6th).

The transaction remains subject to the satisfaction of the applicable conditions precedent for completion.

Prudential plc provides life and health insurance and asset management in 24 markets across Asia and Africa. Prudential Zenith Life Insurance Limited, formerly known as Zenith Life Insurance, was established in 2006 as a subsidiary of Zenith Bank Plc. In 2017, Prudential Group UK acquired a 51% stake in Zenith Life Insurance, leading to the formation of Prudential Zenith Life Insurance Ltd.