(NAIROBI, KENYA) – Absa Group has signed an agreement to sell its majority shareholding in two Kenyan insurance companies to First Assurance Investments Limited, a company linked to Prime Cabinet Secretary Musalia Mudavadi.
The South African banking group announced the sale and purchase agreement on Thursday evening. The deal covers Absa’s entire 63.32 percent stake in both Absa Life Assurance Kenya Limited and First Assurance Kenya Limited.
Sources familiar with the transaction said Absa will seek at least KES 3.8 billion (approximately $29.4 million / £23.1 million / €26.7 million) for the two stakes. The final valuation remains subject to regulatory approvals.
A regulatory filing confirmed the agreement. “Absa Group Limited has entered into a sale and purchase agreement with First Assurance Investments Limited, an existing shareholder of First Assurance Company Limited and Absa Life Assurance Kenya Limited for the sale of Absa’s entire stake in the two businesses, which amounts to 63.32 percent shareholding in each of the two entities,” the filing stated.
Public registry records show First Assurance Investments is owned 52.5 percent by Syndicate Nominees, a company Mr Mudavadi acknowledged owning during his 2022 vetting for the Prime Cabinet Secretary position.
The transaction represents a buyback of shares sold to Absa, then operating as Barclays Africa, in 2015 for KES 2.2 billion (approximately $17 million / £13.4 million / €15.5 million).
Exclusive Holding Limited, a Mombasa based investment firm, holds the remaining 47.5 percent stake in First Assurance Investments.
Officials at the Insurance Regulatory Authority confirmed awareness of the deal, which comes amid increased merger and acquisition activity in Kenya’s insurance sector involving companies such as Sanlam, Jubilee and Britam.
During his parliamentary vetting on October 17, 2022, Mr Mudavadi declared a net worth of KES 4.1 billion (approximately $31.7 million / £24.9 million / €28.8 million) to the National Assembly Committee on Appointments. His assets include properties in Nairobi’s Riverside Estate valued at KES 1 billion (approximately $7.7 million / £6.1 million / €7 million), rental office blocks worth KES 870 million (approximately $6.7 million / £5.3 million / €6.1 million) through Tritone Investments, and shares in Absa Bank Kenya and First Assurance Company.
The former vice president also declared KES 200 million (approximately $1.5 million / £1.2 million / €1.4 million) in shares in Exclusive Air Services Limited, a helicopter leasing company, along with high end vehicles worth KES 44 million (approximately $340,000 / £268,000 / €309,000) and stakes in Jodeci Investment valued at KES 120 million (approximately $928,000 / £730,000 / €843,000) and Malulu Land and Developments at KES 250 million (approximately $1.9 million / £1.5 million / €1.8 million).
Absa Life is ranked the seventh largest life insurer in Kenya while First Assurance Kenya holds the thirteenth position among general insurers. Insurance penetration in Kenya remains at three percent, indicating room for growth.
The sale forms part of a broader strategy shift by Absa Group. The Johannesburg based bank is exiting direct insurance ownership across several African markets to focus on bancassurance partnerships, where banks sell insurance products through commission based arrangements without committing capital.
In Kenya, Absa Bank Kenya’s bancassurance net profit grew 35 percent to KES 1.3 billion (approximately $10 million / £7.9 million / €9.1 million) in the year ended December 2025. Meanwhile, Absa Life’s net profit fell 26 percent to KES 790.1 million (approximately $6.1 million / £4.8 million / €5.5 million) during the same period.
The insurance divestment coincides with Absa Group increasing its stake in Absa Bank Kenya to 85 percent from 68.5 percent in a KES 30.9 billion (approximately $239 million / £188 million / €217 million) deal.
Absa Group’s subsidiary, Absa Financial Services, sold its entire stake in Absa Life Botswana to Hollard International last year. It also disposed of its insurance operations in Zambia and Mozambique to the same entity.
“We switched to a bancassurance distribution model with key partners across our Africa regions, hence selling our insurance businesses in Botswana, Zambia and Mozambique,” Absa Group stated in its 2025 annual report.
Mr Mudavadi holds his interest in First Assurance through two investment vehicles. First Assurance Investments and direct ownership through Syndicate Nominees account for a 12.35 percent holding, giving the Prime Cabinet Secretary a combined 21.26 percent stake.
Other shareholders in First Assurance include Stephen Githiga with 4.0 percent, Chandaria Ventures Limited with 1.67 percent, and Epoch Investments Limited and Absa Pension Services Limited each holding 0.84 percent.
Mr Githiga previously served as chief executive of First Assurance Company and Sasini. Chandaria Ventures is linked to Darshan Chandaria and Neer Chandaria, while Epoch Investments is associated with Jambojet chairman Ayisi Makatiani.
Absa Life Assurance Kenya began operations in 2015 after receiving an IRA licence and has since entered the top 10 life insurers in the country. It was the first life insurer in Kenya to adopt a bancassurance distribution model.
First Assurance traces its origins to Prudential Assurance Company, established in Kenya in 1930. Kenyan investors acquired the entire stake from British owners in 1991.