Zurich will sell its operations in South Africa and Botswana for an undisclosed sum to Canada’s Fairfax Financial Holdings.

The deal is subject to regulatory approvals, and both sides expect to finalise it by the end of the fourth quarter, according to Fairfax.

Zurich declined to comment on the sale when contacted by insuranceNEWS.com.au, citing confidentiality clauses.

Zurich has been disposing of underperforming businesses in a bid to return to greater profitability.

The insurer sold its general insurance operations in Taiwan to Hotai Motor and its Moroccan business to Allianz for €244 million ($360.8 million) last month.

It has also pulled out of Australia’s strata market and the NSW compulsory third party market.

Fairfax Chairman and CEO Prem Watsa says the addition of Zurich South Africa, which includes operations in Botswana, “represents a key step in expanding our presence in this important market”.

“It is a high-quality and well-known regional business. Africa is a continent that represents a long-term growth opportunity for Fairfax, but where we have traditionally done little primary commercial insurance business,” he said.

Fairfax has a presence in Australia via subsidiary Odyssey Re, which owns underwriting agency Newline.