creating south africa’s leading financial services institution shared...

Sanlam Group Limited

04 December 2003

- Slide #1 -

Creating South Africa’s leading financial services institution

Creating South Africa’s leading financial services institution


04 December 2003

- Slide #2 -

Johan van Zyl, CEO SanlamJohan van Zyl, CEO Sanlam“Unlocking value for shareholders”


04 December 2003

- Slide #3 -

Transaction based on business and social imperatives


Transaction based on

Business imperative

Develop a “world class” business

Enhance shareholder value

Strengthen Sanlam’s position in its traditional markets

Access to new markets and business opportunities

Broad-based empowerment

Attract, develop and retain best human talent


04 December 2003

- Slide #4 -



Transaction based on

Business imperativeBusiness imperativeBusiness imperative

Social imperative

Contribute to the development of SA

Facilitate broad-based empowerment

“A Truly South African Company”


04 December 2003

- Slide #5 -

HighlightsHighlights

Positions Sanlam as the leading empowered financial

services group to service and reach all markets in SA,

including:

The growing individual emerging market sector

Retirement fund market in corporate, union &

parastatal sectors

Ubuntu-Botho becomes largest active beneficial

shareholder in Sanlam

Active role in Sanlam’s leadership & future development


04 December 2003

- Slide #6 -

HighlightsHighlights

…/continued

Broad-based participation in transaction through business,

community and traditional leaders, trade unions, women,

youth, church and other groups

Positions Sanlam to fully participate in the changing

financial services landscape


04 December 2003

- Slide #7 -

Salient Terms Salient Terms

Ubuntu-Botho group to acquire 10% of Sanlam as one

indivisible transaction

Certainty of shareholding, vesting and full voting rights

R200m cash contribution by the Patrice Motsepe Group

through Sizanani-Thusanang-Helpmekaar (Proprietary)

Limited (“Sizanani”)

Board representation at Sanlam Group and subsidiary level


04 December 2003

- Slide #8 -

Salient Terms Salient Terms

…/continued

Broad-based participation achieved through diverse

shareholder base

Business, traditional and community leaders, women,

church, youth, trade union groups and other successful

BEE companies

Development Trust aimed at advancing community

upliftment, BEE and CSI initiatives


04 December 2003

- Slide #9 -

Salient TermsSalient Terms

…/continued

169m shares constituting 6% of Sanlam’s equity will be

acquired by Ubuntu-Botho for R1.3bn

R200m of which will be funded by a cash contribution

provided by the Patrice Motsepe Group through Sizanani

56m shares constituting 2% of Sanlam’s equity will be

transferred to the Sanlam Ubuntu-Botho Community

Development Trust to benefit disadvantaged communities

after servicing of debt


04 December 2003

- Slide #10 -

Salient TermsSalient Terms

…/continued

Deferred shares issued to convert into ordinary shares as

growth targets are achieved over 10 year period, based on

Net inflow of funds; segregated and group

Annual growth in New Business Embedded Value

Effective date targeted for 1 January 2004, subject to

approvals


04 December 2003

- Slide #11 -

Potential ImpactPotential Impact

Transfer of shares to Trust will have 2% EV dilution,

increases to <3% due to new issues at below EV

Transaction aimed at growing Sanlam and its business;

structure motivates & rewards growth

Worst case scenario will result in a dilution of <5%

If expectations are met, transaction will be earnings

enhancing


04 December 2003

- Slide #12 -

Potential ImpactPotential Impact

…/continued

Benefits of transaction should contribute to further

re-rating of Sanlam’s share-price

Further detail on potential impact will be provided in

circular and detailed terms announcement


04 December 2003

- Slide #13 -

Operations : Sanlam LifeOperations : Sanlam Life

Major steps taken to improve cost effectiveness,

distribution and product innovation

Offers full range of competitive individual risk and

savings products

Comprehensive and competitive EB offering covering

admin, risk and investment

Group schemes business launched to service entry level

market

Working at developing TPA in-source offering

Covers wide spectrum of target markets


04 December 2003

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Operations : Sanlam Investment ManagementOperations : Sanlam Investment Management

Management team and investment process restructured

Results improving, targeting sustainable top half

performance

Significant new mandates won, net inflow of segregated

funds of R4 bn by 30 June 2003

Responsibility for investment management of off-shore

funds

Full offering of multi-manager, unit trusts, linked products,

property asset management, administration


04 December 2003

- Slide #15 -

Other Operations Other Operations

Santam: real market leader

excellent performance

strategy to further enhance value through operational

and strategic actions

Gensec restructuring progressing

SCM business model completed

enhancing the Sanlam value proposition

Absa co-operation progressing

partnership potential being pursued

enhance offering of both groups


04 December 2003

- Slide #16 -

Patrice MotsepeChairman, Ubuntu-Botho

Patrice MotsepeChairman, Ubuntu-Botho

“A partner in the creation of sustainable value

for all stakeholders”


04 December 2003

- Slide #17 -

Ubuntu-Botho shareholding structureUbuntu-Botho shareholding structure

Broad Based Broad Based BEE GroupsBEE Groups((including business, community &

traditional leaders, trade unions, women,

youth, church and other groups))

Sanlam Sanlam UbuntuUbuntu--BothoBotho

Community Community

Development TrustDevelopment Trust

SizananiSizanani--ThusanangThusanang--

HelpmekaarHelpmekaar (Pty) Ltd (Pty) Ltd

((““SizananiSizanani””))

UbuntuUbuntu--BothoBotho

Investments LimitedInvestments Limited

((““UbuntuUbuntu--BothoBotho””))

Sanlam LimitedSanlam Limited

25% 20% 55%

10%

1

Sanlam Life Sanlam Life

Insurance LimitedInsurance Limited

Sanlam Investment Sanlam Investment

Management LimitedManagement LimitedSantamSantam LimitedLimited

100% 100% 54%


04 December 2003

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Ubuntu-BothoUbuntu-Botho

Provincial

Groups *

Provincial

Groups * Trade UnionsTrade UnionsWomen

Provincial

Groups *

Women

Provincial

Groups *

•Single company

per province

•± 540 total

shareholders

•± 60 shareholders

per company

Church GroupsChurch Groups

•Single company

per province

•± 720 total

shareholders

•± 80 shareholders

per company

•± 50 non-

professional

•± 30 professional

•Male and female

•Includes

traditional leaders

Youth GroupsYouth Groups CorporatesCorporates

Composition of broad-based BEE GroupsComposition of broad-based BEE Groups

25%

* Provinces

Free State, Gauteng, KwaZulu Natal, Western Cape, Eastern Cape, Limpopo Province, Northern Cape, North West & Mpumalanga


04 December 2003

- Slide #19 -

Ubuntu-Botho : Social & economic upliftment of all South Africans


The Ubuntu-Botho consortium consists of broad based

empowerment shareholders including:

Respected business, traditional and community leaders,

women, church, youth, trade union groups and other

successful empowerment companies

Poor and unemployed South Africans will also benefit from

the transaction through the Sanlam Ubuntu-Botho

Community Development Trust, which will:

Advance and support community upliftment and

development projects

Support other BEE initiatives and corporate social

investment programmes


04 December 2003

- Slide #20 -



…/continued

The R200m cash contribution by the Patrice Motsepe Group

through Sizanani assists and facilitates the participation of

the broad based empowerment groups in this transaction


04 December 2003

- Slide #21 -

Contribution of Ubuntu-BothoContribution of Ubuntu-Botho

For Ubuntu-Botho this transaction presents an opportunity:

To participate in Sanlam and contribute to making it

the leading financial services company in South Africa

To assist and facilitate broad-based empowerment in

the financial services sector

To strategically position Sanlam to provide financial

services to the emerging market in South Africa

To participate in the creation of a truly South African

company that makes a meaningful contribution to the

growth and development of the economy

To contribute towards generating sustainable

competitive returns for shareholders


04 December 2003

- Slide #22 -

…/continued

Consortium’s experienced leadership is well positioned to

add value to the Sanlam franchise

Through Board representation at Group and subsidiary

levels

Key to preserving and unlocking value

Substantial cash contribution reflects commitment and

confidence in Sanlam’s growth prospects

Positions Sanlam to fully participate in the changing

financial services landscape

Contribution of Ubuntu-BothoContribution of Ubuntu-Botho


04 December 2003

- Slide #23 -

QuestionsQuestions


04 December 2003

- Slide #24 -

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