Quilter buyback will reduce costs

London-based Quilter, Old Mutual’s former wealth management business, plans to spend about £30m (about R623m) buying back shares from smaller shareholders to reduce costs. Shareholders with fewer than 100 shares will be able to sell their stakes at a 5% premium.

London-based Quilter, Old Mutual’s former wealth management business, plans to spend about £30m (about R623m) buying back shares from smaller shareholders to reduce costs.

Shareholders with fewer than 100 shares would be able to sell their stakes at a 5% premium, a move Quilter said could roughly halve the number of shareholders and reduce the complexity and cost of managing its shareholder base.

Quilter, which has a market capitalisation of R55bn, also announced its results for the year to end-December on Wednesday, and intends to use the £375m from its recent sale of Quilter Life Assurance to buy back its own shares.

The group reported adjusted profit before tax rose 1% to £235m, with assets under management up 13% to £110.4bn.

Quilter CEO Paul Feeney said on Wednesday the group is optimistic about its prospects. It is now a “highly scalable business with a broader range of solutions to meet clients needs”.

Although 2020 had begun well, the market correction that began in February had created a high degree of uncertainty, he said. “It is currently too early to ascertain what impact market volatility will have on investor sentiment, net client cash flow and the consequential impact this may have on revenues and profitability,” Feeney said.