News

AFRICA First ReNaissance Corporation has increased its stake in hospitality concern Rainbow Tourism Group by about 10 percent.According to a statement accompanying the group’s results for the year ending December 31 2009, Afre’s shareholding in RTG is now 25,18 percent.Afre previously owned 15,3 percent in RTG, which it acquired in June 2008.As a result of that acquisition, Afre was allocated two board seats resulting in its executive chairman Mr Patterson Timba being appointed RTG board chairman.According to the statement, the decision to shore up shareholding in RTG was in line with Afre’s strategic thrust.The additional acquisition moves Afre closer to the 30 to 35 percent that would make RTG an associate company of the group.

Speculation has been rife that Afre wants to pair its property arm, Pearl with RTG.Pearl has in the past openly declared its appetite for the leisure sector with its managing director, Mr Francis Nyambiri saying that they see the tourism industry as a growing market which they can use to get ahead.Pearl is planning to construct a prime leisure property once it acquires land from ongoing negotiations with local authorities.Meanwhile the group’s total income for the period was US$35,2 million while gross claims stood at US$11,8 million and were in line with expectations.Afre’s profit for the period amounted to US$29,3 million that was driven by growth in fair value of investments as well as the write-back of deferred tax during the year.

The group’s property arm achieved average rentals per square metre of US$3,04 up from US$2,83 in June 2009.Despite the increase, this was however below the target of US$3,50 per square metre.The reinsurance, property and casualty business achieved gross premiums written of US$8,9 million from new business lines written during the year while the reinsurance, life and health business achieved gross premiums written of US$1,04 million.This was after the company secured new retrocession agreements for 2010, which should provide capacity to write additional business.In addition the reinsurance arm is expected to benefit from regional opportunities and linkages for training and new products that were secured for execution this year.

In terms of short-term insurance, its subsidiary Tristar Insurance achieved gross premium written of US$7,3 million after business grew as a result of fresh capital injection by shareholders resulting in business growth and increased retention capacity.However business for the arm continues to be affected reduced levels of insurance by clients, the downward correction of values of insurable assets and the reduction of insurable period from annual policies.