| Mon 1 Oct 2001, 0:00 | | Sanlam Sells Its Health Business To Medscheme |
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Sanlam Limited
Share code: SLM
ISIN: ZAE0000282262
Sanlam today (1 October 2001) announced that it has sold its interest in
Sanlam Health to Medscheme, the largest healthcare company in South Africa,
subject to the approval of the competition authorities. This follows the
successful turnaround of the ailing business during 1998/99 and its
subsequent positioning as a market leader in the field of medical risk
management.
Dr Leon Vermaak, Sanlam's chief executive, said that wealth and health are
emerging as the two most important issues for individuals in their financial
planning. "Sanlam Health is relatively small in comparison with the Group's
overall business, and to have become a truly significant player in the
healthcare market would have required a significant increase in membership,
in addition to a long-term administration solution.
"Bearing in mind our company focus of creating wealth for our clients, we
came to the conclusion that access to the best healthcare products in South
Africa was more important than becoming a leading healthcare company
ourselves. I am pleased that we were able to conclude an agreement with a
company of Medscheme's standing. We will now be able to offer our clients a
considerably broader range of quality healthcare products, while they can be
assured of a smooth transition and excellent service," he said.
While neither of the parties would disclose the price involved in the
transaction, Dr Vermaak said that the deal is not material relative to
Sanlam's market value. "It would unlock capital for Sanlam and we anticipate
that it would not have a negative affect on Sanlam's profits," he concluded.
Chief executive of Medscheme, Anton Roux, said that they were delighted with
their successful offer for Sanlam Health. "We are not only acquiring the
administration and managed care contracts for Topmed and Selfmed's 45 000
families, but also the valuable risk management expertise from the team at
Sanlam Health, who have
already expressed their endorsement of the transaction. We are gaining some
excellent managed care contracts, as well as value-added services to
Transmed, LAMAF, BESTmed, Munimed and other schemes," he said.
He added that apart from the standard annual revision of fees and service
structures by all healthcare companies and medical schemes, the transaction
would have no effect on the existing benefits of individual members.
Sanlam Health has about 250 employees, all of whom will be employed by
Medscheme after the transaction has been approved by the competition
authorities.
This announcement comes in the wake of Sanlam's encouraging interim results
in September and its announcement of a new vision - to be the leader in
wealth creation - with a new business strategy based on domestic growth,
client relations and internationalisation. Medscheme has recently taken on
the 100 000 families of Fedsure health and has the nation-wide branch
infrastructure to administer Sanlam Health's large schemes.
- Ends -
Enquiries: Johan du Preez, Chief Executive: Sanlam Health (021) 947-6183
Anton Roux, Chief Executive: Medscheme (011) 510-2702
Issued by Frans van Rensburg, Sanlam Media Relations, (021) 947-4893/
082 805 9245.
Note to editors. Sanlam Health posted a loss of R220 million in 1998. This
was turned around first under the management of Charl le Roux (now CEO of
Sanlam's Innofin) and later under current CEO, Johan du Preez, to a profit
of R11 million in 1999, R15 million in 2000 and R7 million in the first six
months of 2001.
