This article is part of a series sponsored by Britam.

The Britam Group, one of Kenya’s leading financial services providers, is represented by British American Investments Company. The company is the 100% beneficial owner of British American Insurance, British American Asset Managers and Britam Insurance Company in Uganda which provide its core business.

This means that British-American Investments Company combines the financial performance of the three Britam subsidiaries in its financial statements and unifies the direction ans strategy of Britam into one single company. British-American Investments Company is listed on the Nairobi Securities Exchange (NSE) with assets worth 32.3 billion shillings and earnings of 1.8 billion shillings in the six months to June this year.

[caption id="attachment_23529" align="aligncenter" width="594"] The structure of the Britam Group[/caption]

Unlike its insurance subsidiary, British-American Investments Company has a relatively short history having been incorporated in Kenya in July of 1995 under the name of British-American Financial Services Ltd. The company was created to be a holding company for companies engaged in providing financial services. The name British-American Financial Services Ltd was changed to Britak Investments Company Ltd in September of 2003 and then changed again to British-American Investments Company in 2006. British-American Investments Company also has a management team independent of its subsidiary companies headed by Mr. Benson Wairegi who is the Group Managing Director.

In 2004, British-American Investments took over the ownership of long standing British-American Insurance through a share swap. In the same year, British-American Investments established British-American Asset Managers to offer asset management and investment advisory services to individuals and institutional clients thus making British-American Investments Company a diversified financial services Group for the first time.

Still in 2004, British-American Investments Company first acquired its strategic ownership stake in Equity Bank which stood at 11.05% last year. In 2007 British-American Investments Company acquired an initial 4.9% ownership stake in leading mortgage provider Housing Finance Company of Kenya which had grown to 16.57% as of late last year. In 2006, local private investors acquired an additional 30% of British-American Investments Company rendering the Britam Group more than 60% owned by local investors. On the 26^th July of 2010, the Group established the Britam Insurance Company in Uganda.

IPO

On the 17^th of June 2011, shareholders of British-American Investments Company approved the raising of 5.85 billion shillings through an Initial Public Offering (IPO) to finance the Group’s growth strategy which included regional expansion, diversification into real-estate, and developing operations in the core Kenyan market.

The IPO commenced on July 12^th 2011 saw the shares of British-American Investments Company listed on the Main Investment Market Segment of the NSE at an initial price of KES 9 per share but only raised 3.50 billion of the targeted 5.85 billion shillings forcing the Group to adjust its main real estate development strategy. This year, British-American Investments announced that it was setting up a 10 billion shilling property fund. British-American shares are currently trading at KES 6.30 per share.

Financial Comeback

British-American Investments’ net earnings had grown from 444.3 million shillings in 2006 to 2.71 billion shillings in 2010 but in 2011 – the same year of its undersubscribed IPO – the Group reported a 1.7 billion shillings loss before tax. For the first six months of this year the Group however posted a 17-fold growth in profit to 1.8 billion shillings on the back of returns from fixed income investments; returning to the profit-making zone.

Going forward, the British American Investments Company remains committed to building a long term, sustainable business in East Africa by pursuing both local and regional expansion and focusing on property development.

Later this week we will focus on each of the subsidiaries that make up the Britam Group namely British-American Insurance Company Kenya, British-American Asset Managers and Britam Insurance Company in Uganda.