All investments are made with the ARC Fund, which has 100% of all Diversified (non-financial) Investments and 49.9% of all Financial Services Investments. The balance of 50.1% of Financial Services Investments is held in ARC Financial Services, a 100% subsidiary of ARC.
As at 30 June 2020, the ARC Fund had an Intrinsic Portfolio Value of R11 139 million (2019: R9 359 million) of which R 7 728 million (69.4% of the portfolio) is attributable to the Diversified Investments portfolio and R3 411 million (30.6% of the portfolio) is attributable to the Financial Services portfolio.
The ARC Fund’s strategy for the Financial Services portfolio is to be an investor in leading providers of products and services in the South African financial services sector and thereby having exposure to a holistic financial services offering to clients. The objective is to follow a focused financial services’ sector strategy that seeks to develop revenue synergies between investments in distribution businesses and investments in related financial services product providers.
Pursuant to this strategy, the ARC Fund, through ARC Financial Services, aims to establish a significant presence in the following underlying financial services product provider sectors: banking, asset management & insurance (life insurance, short term insurance, health), and specialist financial services businesses.
Our financial services strategy is premised on securing a significant position in the distribution of financial services products and accelerating the growth of financial services product providers within its portfolio. ARC Financial Services may invest in start-up businesses whose revenue growth can be expected to be significantly enhanced by access to the underlying distribution businesses.
All of ARC Fund’s interests in the financial services sector will be acquired through ARC Financial Services.