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Send  Share  RSS  Twitter  16 Sep 2014

VENTURES: New Kid on the Actuarial Block Eyes African Expansion

 





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The merger of two complementary mid-tier South African firms into ARGEN Actuarial Solutions has created a new large actuarial firm with an established network in Africa and that has an eye for further African growth.

On 1 March 2014, independent South African actuarial firms Arthur Els and Associates (AE and A) and Genesis Actuarial Solutions merged to form ARGEN Actuarial Solutions – two mid-tier specialist companies coming together to create one of the largest independent actuarial firms in Africa.

Started in 2004 by Arthur Els, and one of only two Certified Enterprise Risk Actuaries in South Africa, AE and A specialised in the valuation of retirement funds, preparation of accounting disclosure for companies' employee-benefit arrangements, asset-liability modeling, providing actuarial services to retirement funds and enterprise risk management.

Francois Rosslee and Tommie Doubell established Genesis in 2000, originally to provide actuarial calculations for the United Kingdom Pensions Review. Its independent team of actuaries provided pension fund services, but also became expert in Road Accident Fund calculations and in providing outsourced support for administrators and other actuarial firms as required.

Through ARGEN, both companies will be able to offer a broader pool of actuaries and a wider range of services. This, combined with the fact that the firm is committed to playing an independent but supportive role to funds and advisors, and the fact that they have significant African experience between them, make them an appealing alternative as an actuarial service provider.

“The nice thing about the merger is that the two companies do different things in different actuarial fields, so there are no retrenchments, or closing of offices – it really is a merger that will generate synergy. It’s hard for an actuary to accept it, but in this case, one and one adds up to more than two!” says Francois Rosslee, director of the new venture.

Arthur Els, CEO, agrees “We can now offer new services to former Arthur Els and Associates clients, and vice-versa, as far as Genesis goes. There were a couple of reasons for the merger, but primarily, it allows us to create a deeper pool of actuaries, more security and a wider service offering to clients, and a significant African platform.

Growth into Africa

ARGEN has an active commitment to B-BBEE codes and social development, donating annually to bursaries that provide tertiary education for disadvantaged students. Significantly, ARGEN is classified as a Level 2 B-BBEE contributor in terms of the Codes of Good Practice promulgated by the Department of Trade and Industry, so clients can claim 125% of the firm’s fees as procurement from a B-BBEE service provider.

By blending both its parent companies’ assets, ARGEN now has offices in Centurion, Johannesburg, Kroonstad and Namibia, with plans to open a Cape Town office. It is keen to continue expanding its operations into the rest of Africa, taking advantage of opportunities created by the continent’s development boom and growing consumer market. Both of these phenomena increase the need for actuarial services in support of funds and risk management – a need that ARGEN is perfectly positioned to fill. “AE and A was already established in Namibia and Malawi – in fact, they had half the market in Namibia, so they’re a big player there,” says Doubell, “while Genesis had operations in Tanzania, Kenya and Uganda, and we were also doing business in the DRC and Nigeria. So the merger immediately expanded ARGEN’s footprint into the rest of Africa, and we will be working actively to extend this.”

“Tommie is very much a networking person, which will help us get into those markets,” adds Els. “Genesis was the first non-European company to join the European Actuarial and Consultancy Services (EURACS), and now ARGEN is a member. It’s helpful, because many of the African countries we’re working in have actuarial standards originally put in place by colonial European powers, so it does make it easier to network around common norms and best practice.”

Creative innovation

Els credits the merger with re-energising both teams. “Arthur Els and Associates was a lovely company to work in, but we were getting staid,” he says. “This has generated a whole new hype in the business – and they’re experiencing the same in the Genesis team too. There’s a whole new ‘let’s get going’ atmosphere. Both companies have always relied on their accuracy, their efficiency and their innovative interpretation of the numbers to create solutions.” Tommie Doubell quips, “I’ve already had a client say, ‘The great thing about Arthur is that if he comes with a problem, he already has a solution to suggest’. Finding those innovative solutions is one of our strengths.”

Warming to his theme that great actuarial solutions require both precision and creativity, Els explains: “They say that when Einstein was working on the Theory of Relativity, he was actually pipped at the post on the maths – a French mathematician beat him in working out the relevant formulas. But the Frenchman didn’t know what to do with that maths; it took Einstein’s creative ability to use those formulas and apply them to explain relativity before the maths was of any use. I believe that our main competitive advantage draws on that example. Our independence allows us to take the creative-solutions leap, without breaching the Chinese walls between administrators and internal actuaries: we go beyond saying, ‘There are the facts’ – we’re able to interpret them in a way that shows the best course for the client to follow. As our new slogan says; it’s where precision meets innovation.”




 
 
 
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