An investment firm associated with Prime Cabinet Secretary Musalia Mudavadi is in talks to buy majority stakes in two insurance firms from South Africa’s Absa Group.

Absa Group on Thursday evening announced that it has inked an agreement to sell its majority stake in Absa Life Assurance and First Assurance Kenya Limited to its Kenyan partner—First Assurance Investments Limited.

The South African financial giant is exiting the insurance business in a number of African countries, including Botswana, Zambia and Mozambique, as it increases its stake in the Kenyan subsidiary.

A search at public registry revealed that First Assurance Investments is owned 52.5 percent by Syndicate Nominees, a company Mr Mudavadi said he owned during his vetting in 2022 for the Prime Cabinet Secretary post.

Absa Group has a 63.3 percent stake in each of Absa Life Assurance and First Assurance Kenya Limited.

Sources close to the transaction reckon that Absa Group will seek at least Sh3.8 billion for the two stakes.

“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,” said a regulatory filing seen by the Business Daily.

Read: Absa under pressure to diversify revenues

Sources at the Insurance Regulatory Authority (IRA) confirmed the deal amid increased deal-making in Kenya’s insurance sector, which has seen share transactions involving Sanlam, Jubilee and Britam.

For Mr Mudavadi and his partner in First Assurance Investments Limited, the transaction will see them buy back the shares they sold to Absa (then Barclays Africa) in 2015 in a Sh2.2 billion deal.

An investment firm called Exclusive Holding Limited, with roots in Mombasa, holds the remaining 47.5 percent stake in First Assurance Investments.

During his vetting on October 17, 2022, Mr Mudavadi disclosed a net worth of Sh4.1 billion to the National Assembly Committee on Appointments, making him one of the wealthiest Cabinet members.

Properties in upmarket Riverside Estate and shares in Absa Bank and First Assurance Company account for the largest share of his wealth.

The Riverside stable was worth Sh1 billion. He also disclosed rental office blocks worth Sh870 million through a firm known as Tritone Investments, underlining his heavy investments in property.

Mr Mudavadi, a former vice-president, also declared Sh200 million shares in Exclusive Air Services Ltd—which leases helicopters.

He also disclosed ownership of high-end cars worth Sh44 million as well as shares in investment firms Jodeci Investment (Sh120 million) and Malulu Land and Developments (Sh250 million).

Absa Life is the seventh largest life insurer while First Assurance Kenya is number 13 among general insurers in a market where premiums continue to grow.

The current insurance penetration of three percent presents potential for investors seeking growth and dividends.

Absa’s exit from the insurance business in several countries marks a strategy shift as it seeks to tap insurance billions through bancassurance as opposed to direct ownership.

The bancassurance model, or a partnership where a bank sells insurance products, will allow Absa to profit from the sector through commissions, without putting its capital on the line.

In Kenya, Absa Bank Kenya’s net profit from bancassurance grew 35 percent to Sh1.3 billion in the year ended December 2025, placing it top in the country’s bancassurance business.

During the same period, Absa Life’s net profit fell 26 percent to Sh790.1 million, offering clues on why the South African giant is selling its majority stake in the two companies.

Absa’s deal with First Assurance Investments comes at a time when the Johannesburg-based group is increasing its stake in Absa Bank Kenya to 85 percent from 68.5 percent in a Sh30.9 billion deal.

Absa Group’s subsidiary, Absa Financial Services, last year sold its 100 percent stake in Absa Life Botswana to Hollard International, the international wing of South Africa’s Hollard Insurance Group.

In the same year, it sold its entire stake in Absa Life Zambia and its Mozambique insurance operations 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 said in the 2025 annual report on the three deals.

Mr Mudavadi owns First Assurance through two investment vehicles, First Assurance Investments and directly through Syndicate Nominees, with a 12.35 percent ownership, giving the Prime Cabinet Secretary a 21.26 percent stake.

Other shareholders of First Assurance are Stephen Githiga (4.0 percent), Chandaria Ventures Limited (1.67 percent), Epoch Investments Limited and Absa Pension Services Limited with 0.84 percent each.

Mr Githiga is the former CEO of First Assurance Company and Sasini. Chandaria Ventures is associated with Darshan Chandaria and Neer Chandaria, while Epoch Investments is associated with Jambojet chairman Ayisi Makatiani.

Absa Life Assurance Kenya commenced operations in 2015 after receiving an IRA licence and has grown over time, breaking into the top 10 life insurers in the country.

It was the first life insurer in Kenya to adopt a bancassurance model of distribution.

First Assurance started off in Kenya as Prudential Assurance Company in 1930 before Kenyan investors bought the entire stake from Britons in 1991.

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