Alexander Forbes eyes acquisitions after insurance sale to Sanlam

Alexander Forbes has reported a 4 per cent growth in headline earnings per share for the year ended March, marking an improvement from the prior comparable period. The company also disclosed a 29 per cent rise in assets under administration, with assets under management surpassing the significant milestone of R400 billion. Dawie de Villiers, CEO at Alexander Forbes, joined CNBC Africa to provide insights into the company's recent developments. The strategic decision to sell off its insurance businesses was driven by the company's vision to streamline its focus towards becoming an advice-led, independent entity. According to de Villiers, the move was necessary in order to eliminate conflicts of interest and achieve a clearer path forward for the organization. Despite the challenges faced during the negotiation process amid the COVID-19 pandemic, the collaboration between Alexander Forbes and Sunlam resulted in a satisfactory agreement that now provides the company with the certainty to direct its attention towards its core operations. With the sale of the insurance businesses finalized, Alexander Forbes now stands as a pure player in the market, focusing on administration, consulting, and asset management services. This strategic shift positions the company as a leading advisory provider, enabling it to offer independent and tailored solutions to its clientele. By concentrating on these fundamental pillars, Alexander Forbes aims to enhance its service delivery and consolidate its position as a prominent player in the South African financial sector. Looking ahead, Alexander Forbes is set to pursue growth through a combination of organic and inorganic initiatives. The company is well poised for acquisitions, with a solid financial standing resulting from the recent divestiture. The influx of cash reserves from the sale of the insurance businesses, coupled with the availability of leverage, provides Alexander Forbes with the flexibility to explore potential investment opportunities in the medium to large-scale range. By expanding its portfolio through strategic acquisitions, the company aims to increase its scale of operations and achieve cost efficiencies that can benefit its clients. In terms of asset management, Alexander Forbes experienced a notable 29 per cent surge in assets under management, attributed partly to market gains and significant new business wins. The company's success in attracting new clients and expanding its asset base to reach the R400 billion mark signifies a milestone moment. With a strong foundation established, Alexander Forbes is optimistic about its growth prospects and revenue generation in the upcoming financial period. The favorable market conditions at the start of the reporting period have positioned the company on a positive trajectory, setting the stage for continued expansion and financial success in the coming years. In conclusion, Alexander Forbes' strategic realignment towards an advice-led business model, coupled with its focus on acquisitions and asset growth, reflects its commitment to sustainable growth and market leadership. The company's transition to a pure player in the financial services sector signals a new chapter in its evolution, as it strives to deliver innovative solutions and superior value to its clients.