US-based LeapFrog Investments has acquired a minority stake in East African financial services company Apollo Investments for $14million (Ksh1.15 billion).
LeapFrog’s capital will be used to extend Apollo’s regional reach, with the company seeking to expand its services to target 7.9 million self-employed people across East Africa’s informal sector. The investor believes the growth of company will help reshape the regional insurance market.
“Apollo’s track record and commercial courage are exactly what we look for in a partner,” said Doug Lacey partner at LeapFrog. “We are pleased to be investing in an insurer with multiple strong business lines, longstanding leadership in its region, and the capacity to tap the vast market of lower-income clients.”
Established in 1977, Apollo is an investment holding company with four subsidiaries the in asset management, property development and general and life insurance segments of the financial market. The company’s assets reached Ksh9.9billion in 2010, a 782% growth since 2000. In the same period, Apollo’s premiums have grown from Ksh472m to Ksh5 billion.
Apollo’s pre-tax profits reached Ksh355 million in 2009. Apollo’s insurance arm is one of the few companies offering medical coverage to Human Immunodeficiency Virus (HIV) infected policy holders. Headquartered in Nairobi, Kenya, Apollo also has operations in Uganda and Tanzania.
LeapFrog’s made the investment from its $135million fund that primarily seeks to invest in micro-insurance companies. JP Morgan, the Teachers Insurance and Annuity Association – College Retirement Equities Fund (TIAA-CREF), Promotion et Participation pour la Coopération économique (Proparco) and the Waterloo Foundation are some of the investors in the fund.