RMI plans to list Outsurance

Rand Merchant Investment Holdings (RMI) recently announced plans to list its Outsurance Business in the next 12 months, and this move has resulted in a significant surge in the company's share price. This decision comes after the successful unbundling of stakes in Discovery and Momentum, leading to the payment of an ordinary and special dividend to shareholders. Herman Bosman, CEO of RMI, joined CNBC Africa to discuss these developments. According to Bosman, the decision to list Outsurance was a strategic one aimed at focusing on the group's core short-term insurance business. By unbundling its assets and selling off Hastings, RMI was able to capitalize on Outsurance, leading to a substantial profit and the distribution of a special dividend. Bosman emphasized that the market's positive reaction to the unbundling process demonstrated the preference for a more focused group with streamlined operations. The transition to a single asset company with Outsurance as the primary focus will involve minimal changes for RMI shareholders. The company will retain its listing and management team but will operate under the name Outsurance. Bosman confirmed that he plans to step down as CEO towards the end of the year, focusing on overseeing the orderly monetization of RMH's portfolio. The departure of founding member Laurie Dipana from RMI's board was described as a natural progression, considering the company's strategic evolution. Dipana and other founders have reached retirement age, allowing the next phase of the company's growth to unfold. Bosman highlighted the maturity of RMI's businesses, comparing them to "teenagers leaving home with their driver's licenses." The focus now shifts to the growth prospects of Outsurance in the medium term. Outsurance has shown promising premium growth in South Africa and Australia, with plans to expand its insurance business division and explore new distribution channels. Additionally, the company aims to establish a short-term insurer in a third country, diversifying its geographic presence. Bosman also touched on RMI's other assets in the FNTIC space, noting their steady growth and the commitment from Outsurance to continue supporting their development. Overall, RMI's strategic moves to unlock value through the listing of Outsurance have been well-received by the market, setting the stage for a focused and dynamic future for the company.