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Questions raised as Old Mutual completes UAP Holdings takeover

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The acquisition of majority shareholding of UAP Holdings Ltd by Old Mutual is complete after four years of a complicated process.

Old Mutual Ltd chief executive officer Peter Mwangi says the rest of the transactions relating to legal structure are progressing according to the integrated financial services strategic plan.

“These transactions are all complete. They are in compliance with the regulatory framework and approved by the relevant authorities,” Mr Mwangi said.

From 2015 to 2018, Old Mutual acquired shares at UAP Holdings valued at Sh25.6 billion, making it the majority shareholder at 66.7 per cent.

The acquisition of UAP Holdings Ltd was progressive.

In January 2015, it was at 37.33 per cent but had jumped considerably by June of the same year.

The acquisition meant winding up the business schemes previously run by UAP Holdings Ltd as the two companies continued to operate similar units in life insurance and asset management while working out the complex merger.

But even as Mr Mwangi gave the assurance, there have been fears that the process faced headwinds, with reports that all UAP liabilities were never disclosed to Old Mutual.

The latter company, according to reports, came to realise that the value of UAP was lower than what had been paid for. However, Mr Mwangi dismisses the reports.

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“All shareholder movement transactions relating to UAP Holdings Ltd have been publicly disclosed through announcements, in compliance with the Capital Markets (Securities, Public Offers, Listing and Disclosure) regulations, as the company is trading its shares over-the-counter,” Mr Mwangi said.

However, the Capital Markets Authority and the Insurance Regulatory Authority failed to give their side of the story despite many phone calls, text messages and emails, which were acknowledged.

CMA chief executive and IRA’s Noella Mutanda neither confirmed nor denied any disagreements on the disputes relating to the acquisition and whether the matter had been reported to them.

The two had promised to respond to our inquiries by Friday, but it was not to be.

With the merger in October 2015, then CMA chief executive Paul Muthaura said the authority had accepted to revoke UAP Holding’s licences as the fund for real estate investment trusts manager as well as its permits as a collective investments scheme.

UAP Old Mutual Group is a subsidiary of Old Mutual Ltd — a listed company on the Johannesburg Stock Exchange — and has secondary listings on the London, Malawi, Namibia, and Zimbabwe stock exchanges.

It has a presence in 13 markets across Africa.

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