SANLAM LIMITED — M&A Activity 2026

Mar 4, 2026

Sanlam Limited
(Incorporated in the Republic of South Africa)
Registration number 1959/001562/06
JSE share code: SLM
A2X share code: SLM
NSX share code: SLA
ISIN: ZAE000070660
("Sanlam")

Sanlam Life Insurance Limited
(Incorporated in the Republic of South Africa)
(Registration No. 1998/021121/06)
Bond Issuer Code: BISLI
LEI: 378900E10332DF012A23
("Sanlam Life")

SUBSCRIPTION FOR SHARES IN AFRICAN RAINBOW CAPITAL INVESTMENTS PROPRIETARY LIMITED, REPRESENTING A 25% ECONOMIC INTEREST IN THE DIVERSIFIED INVESTMENTS PORTFOLIO OF THE ARC FUND

1. Introduction

The board of directors of Sanlam (the "Sanlam Board") is pleased to announce the entry into definitive transaction agreements which will result in Sanlam Life acquiring a 25% economic interest in the diversified investments portfolio of the ARC Fund (including debt and cash on the ARC Fund's balance sheet) (collectively the "Investment Portfolio"), subject to the fulfilment of a suspensive condition (the "Proposed Transaction").

The Proposed Transaction entails Sanlam Life subscribing for a separate class of shares in African Rainbow Capital Investments Proprietary Limited ("ARCI") for a cash consideration of R3.2 billion, the rights and participation of which are linked to the Investment Portfolio. The Investment Portfolio excludes the ARC Fund's investment in African Rainbow Capital Financial Services Holdings Proprietary Limited ("ARC FSH").

The ARC Fund is an en commandite partnership formed between ARCI as the limited partner and UBI General Partner Proprietary Limited ("UBI GP") as the general partner. ARCI is an investment holding company that is effectively owned 56.4% by African Rainbow Capital Proprietary Limited ("ARC") and its subsidiaries.

ARC and UBI GP are wholly owned subsidiaries of Ubuntu-Botho Investments Proprietary Limited ("UBI"). For the purposes of the JSE Limited ("JSE") Listings Requirements, UBI is a material shareholder in Sanlam. Accordingly, UBI is a related party of Sanlam.

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1. Rationale for the Proposed Transaction

UBI is Sanlam’s strategic empowerment partner and, in this context, the Proposed Transaction further deepens the strategic co-operation between Sanlam and ARC in private equity investments in South Africa and across the African continent. This is consistent with the shared strategic vision of Sanlam and UBI that alternative investments represent a compelling commercial opportunity across Africa and play an important role in contributing to the broader development of the markets and communities in which Sanlam operates.

Through the Proposed Transaction, Sanlam Life will gain access to a diversified portfolio of non-financial investments which expands Sanlam Investments’ alternative assets exposure and offering, in line with its previously communicated focus on the fastest growing areas of client solutions, which include multimanager solutions, passive investments and alternative investments.

In addition, the Investment Portfolio includes investments that may support the expansion and strengthening of the Sanlam financial services ecosystem and is an appropriate vehicle through which to identify and develop such future investments, particularly against the backdrop of increasing convergence between financial services and other industries.

The Proposed Transaction thereby enhances long-term value creation for Sanlam shareholders, customers and other stakeholders.

1. Consideration

Sanlam Life shall subscribe for a separate class of shares in ARCI by way of payment of a cash subscription consideration of R3.2 billion.

1. Key terms of the Proposed Transaction

The Proposed Transaction is subject to the suspensive condition that the new ARCI memorandum of incorporation (the “New ARCI MOI”) shall have been filed at the Companies and Intellectual Property Commission and shall have taken effect.

The definitive transaction agreements to give effect to the Proposed Transaction contain warranties and indemnities customary for a transaction of its nature. The New ARCI MOI incorporates reserved matters in respect of which ARCI shareholders will need to agree, customary pre-emptive rights and deemed offer provisions.

Sanlam Life will pay an asset outperformance participation fee (inclusive of VAT) to UBI GP which shall be calculated based on net asset value (“NAV”) growth of the Investment Portfolio in excess of 23% per annum, subject to, among others, the following provisions:

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• The hurdle rate will range from 23% to 28% per annum, with performance participation ranging from 4% to a maximum of 25%, respectively;
• The performance participation will be calculated every third year based on the growth in NAV above the higher of (i) the NAV on the effective date of the Proposed Transaction and (ii) the closing NAV of each preceding three-year period;
• Prior declines in NAV and accumulated performance hurdle (from the effective date of the Proposed Transaction) will be recouped prior to recommencing payments of performance fees;
• The arrangement will run for a period of nine years only; and
• The fee will be capped at R300 million (inclusive of VAT) over the nine-year period.

No other management fees will be payable by Sanlam to UBI GP.

To the extent the outperformance participation fee is incurred, it would create incremental value for Sanlam shareholders, given that the Investment Portfolio would have generated returns of more than 23% per annum over a three-year period.

5. Independent fairness opinion

In terms of Section 9.3 of the JSE Listings Requirements, the Proposed Transaction is categorised as a small related party transaction.

The Sanlam Board established a committee of independent non-executive directors (the "INED Committee"), comprising all non-executive directors who are independent of Sanlam and UBI, to evaluate matters which may give rise to conflict of interest.

For purposes of good corporate governance, the Sanlam Board appointed Deloitte Consulting (Pty) Ltd ("Deloitte") as independent professional expert to provide it with an opinion confirming that the terms of the Proposed Transaction are fair insofar as Sanlam shareholders are concerned. This opinion has been provided to the JSE and will lie open for inspection with the subscription agreement at Sanlam's registered office at 2 Strand Road, Bellville, 7530, for a period of 14 days from the release of this announcement. It will also be made available during this period on request from Sanlam's Company Secretary. Please email the request to secretariat@sanlam.co.za.

Following the INED Committee's consideration of the Proposed Transaction, it confirms that the Proposed Transaction was concluded on an arms' length basis and that the Proposed Transaction is fair to Sanlam shareholders. The INED Committee followed a robust and objective process which included considering the valuation of the underlying entities in the Investment Portfolio, the key terms of the Proposed Transaction, the fairness opinion and feedback from the due diligence investigation. The INED Committee was furthermore comfortable that there was no undue influence in arriving to its conclusion.

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1. Financial information

In terms of the audited annual financial statements of ARCI for the year ended 30 June 2025 (prepared in accordance with International Financial Reporting Standards):

• the net asset value of ARCI that is the subject of the Proposed Transaction, amounted to R12.5 billion; and
• the profit after tax that is attributable to the net assets of ARCI that is the subject of the Proposed Transaction, amounted to R1.0 billion.

In terms of the Proposed Transaction, existing investments in Sanlam Life shareholder portfolios will be replaced with the investment in the Investment Portfolio, which will also be made available to the Sanlam Alternative Investment business. The Proposed Transaction will not impact discretionary capital or Sanlam Life's shareholder funds.

1. Effective date

The effective date will be dependent on the fulfilment of the suspensive condition to the Proposed Transaction.

Bellville
4 March 2026

Enquiries:
Sanlam Investor Relations
E-mail: ir@sanlam.co.za

JSE Equity Sponsor to Sanlam:
The Standard Bank of South Africa Limited

JSE Debt Sponsor to Sanlam Life:
The Standard Bank of South Africa Limited

NSX sponsor to Sanlam:
Simonis Storm Securities Proprietary Ltd

Independent Expert
Deloitte Consulting Proprietary Limited

Legal Adviser to Sanlam Life:
DLA Piper Advisory Services Proprietary Limited