Lamu Governor link in Absa sale of two insurance firms

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Lamu Governor Issa Abdalla Issa Timamy is part of a group of investors in line to buy majority stakes in two insurance firms from South Africa’s Absa Group.

Regulatory filings and court documents show the governor is a director and shareholder of First Assurance Investments Limited – the vehicle buying the majority stakes in Absa Life Assurance and First Assurance Kenya Limited.

Absa Group on Thursday last week announced it has signed an agreement to sell its 63.3 percent stake each in the two companies as the South African financial giant exits the insurance business in several African countries, including Botswana, Zambia and Mozambique.

A search at public registry revealed that First Assurance Investments Limited is owed 47.5 percent by Exclusive Holding Limited, a company associated with Governor Timamy.

The other 52.5 percent is under Syndicate Nominees, a company Prime Cabinet Secretary Musalia Mudavadi said he owned during his vetting for the ministerial position in 2022. Mr Mudavadi is also the Foreign and Diaspora Affairs Cabinet Secretary.

It reflects a business union that morphed into a political partnership, which saw Mr Mudavadi serve as the Amani National Congress (ANC) party leader, with the governor his deputy.

ANC dissolved last year to allow a merger with President William Ruto's United Democratic Alliance (UDA).

Registry document indicate that Issa Abdalla Issa directly owns 30 percent of Exclusive Holding Limited and his partner Salim Mohamed Busaidy 18 percent.

The Absa deal comes in the middle of a Sh363.3 million court battle pitting the governor and Mr Busaidy that has entangled the chief executives of NCBA Group, KCB Group and Co-operative Bank.

The criminal suit follows investigations into the alleged theft of Sh363.3 million from First Assurance Investment Ltd by Mr Busaidy.

According to the charge sheet, he siphoned the money from the firm between May 18, 2018 and April 30, 2024 by exploiting his position as a director and accessing the company's accounts held at NCBA Bank, KCB Bank Kenya and Co-operative Bank.

The prosecution says he forged the signature of his co-director – the governor – on company cheques to facilitate the unlawful funds withdrawal.

Investigators add that the forged cheques, valued at between Sh150,000 and Sh350,000 each, were presented as duly authorised, allowing the money to be withdrawn over several years.

Mr Busaidy denies 120 criminal charges, including conspiracy to defraud and steal, 114 counts of making a document without authority and one count of acquiring proceeds of crime.

Prosecutors are seeking to charge the three bank CEOs over failure to report suspicious transactions linked to the Sh363.3 million.

The case uncovered Governor Timamy’s links with First Assurance Investment.

It remains to be seen if Mr Busaidy will participate in the fundraiser for buying the Absa stakes as a shareholder of the investment group.

Sources close to the transaction say Absa Group will be seeking at least Sh3.8 billion for the two stakes.

For Mr Mudavadi, Mr Timany and their 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.

Absa Life is the seventh-largest life insurer while First Assurance Kenya is ranked 13th 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 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.

Absa Bank Kenya’s net profit from bancassurance grew by 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 by 26 percent to Sh790.1 million, a performance that offers clues on why the South African giant is selling its majority stake in the two insurance companies.

Absa’s deal with First Assurance Investments Limited comes as 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.

It sold its entire stake in Absa Life Zambia and its Mozambique insurance operations to the same entity the same year.

“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 transactions.

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

Other shareholders of First Assurance are Mr Stephen Githiga (four 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 chief executive officer 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 was licensed in 2015 and has grown into the top 10 life insurers bracket in the country.

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

First Assurance was established in 1930 in Kenya as Prudential Assurance Company and Kenyan investors bought the entire stake from British investors in 1991.

Reporting originally appeared via Business Daily. Read the full source for additional context.