African Rainbow Capital invests in Capital Legacy

The value of its investment was not disclosed.

South Africa-based African Rainbow Capital (ARC) has acquired a 25 percent shareholding in specialist financial services firm Capital Legacy for an undisclosed consideration.

Capital Legacy is a company that specialises in will drafting and estate administration. The acquisition means that ARC, an investment firm owned by Patrice Motsepe, will complete its participation in the entire financial services value chain.

ARC has shareholdings in financial services companies such as Alexander Forbes, Tymebank, Santam and a few independent insurance broking and asset management firms. ARC said in May it had R700 million to spend on acquisitions.

Operating since 2012, Capital Legacy has identified improved, efficient and cost-effective solutions to will drafting, estate planning and execution. These solutions are significant in South Africa, where only one in four people has a valid will in place at death. Since inception, Capital Legacy has drafted more than 200 000 wills.

“We believe that Capital Legacy fits neatly into the eco-system of financial services businesses that we assemble. These businesses would leverage from one another and create synergies for other businesses within our holistic approach,” said ARC co-CEO Johan van der Merwe (pictured). He said the ultimate plan was to facilitate synergies between Capital Legacy and other companies in which ARC is invested.

Capital Legacy founder and CEO Alex Simeonides, who co-owns the company with five other business partners, said because their business will not compete with ARC’s other investments there should be opportunities to leverage off each other’s capabilities and client base.

“This investment by African Rainbow Capital marks a milestone for Capital Legacy – one that inspires us for the future. Attracting the interest and capital of an investment and empowerment leader like ARC is a significant boost for our business. It will add to our positioning as the most credible provider of various financial products in the estate administration sphere,” he said.

Capital Legacy offers the services and expertise required to provide the planning and documentation every individual needs to ensure his or her assets are dealt with properly and efficiently after death. This role – referred to as a fiduciary responsibility – covers estate planning, financial planning to provide funds for costs arising upon death, and estate and trust administration.

Professionals with both legal and financial knowledge advise clients about their unique needs, such as whether to include provision for a testamentary trust in their will, and what costs their estate is likely to be liable for one day.

In addition to the legal advice provided, Capital Legacy offers financial solutions to specifically make provision for the potential impact of legislated costs associated with an estate.