Old Mutual Limited in return to its SA roots
Market welcomes the listing, while shares rise to R37.83
OLD MUTUAL Limited (OML) yesterday made its longawaited debut on the JSE, with the group saying the listing heralded the group’s return to its African roots.
The market welcomed the listing, with the share rising 0.68 percent to close at R37.83.
Chief executive Peter Moyo said the listing of OML as an independent standalone entity would enable it to unlock shareholder value and create a business with a strong strategic focus on sub-Saharan Africa.
Moyo said the company was hopeful of its fortunes, as it had put out a strong and compelling investment case.
“Our business remains highly cash generative and is well positioned in the right markets to drive added value from our franchises. We are privileged to have a business with a robust capital and liquidity position, which will provide the right springboard to become a leading pan-African financial services business,” Moyo said.
OML also has a standard listing on the London Stock Exchange and secondary listings on the stock exchanges of Malawi, Namibia and Zimbabwe.
The PIC yesterday welcomed the decision of OML to return to the JSE as its primary listing.
The listing is part of Old Mutual Plc’s managed separation strategy, which involved separating the London-based group into four independent, standalone companies.
Quilter, formerly known as Old Mutual Wealth, listed in London and the JSE on Monday.
The remaining two businesses in the group are already independently listed entities, with the Nedbank Group, which OML plans to reduce its shareholding to 19.9 percent by the end of the year from 54 percent.
The former Old Mutual Asset Management company based in the US, had its majority shareholding reduced to 5 percent as part of the managed separation process.
The Public Investment Corporation (PIC) yesterday welcomed the decision of OML to return to the JSE as its primary listing.
“The PIC is particularly pleased to have been able to support and work with the Old Mutual management team throughout the period of managed separation, which has resulted in the successful listing of both OML and Quilter on the Johannesburg and London stock exchanges.
“It has always been the PIC’s preference for South African companies to maintain their primary listing on the JSE. The PIC looks forward to being a significant and supportive investor of both Old Mutual and Quilter in the future,” the PIC said.
Ron Klipin, a senior analyst at Cratos Wealth, said OML would benefit from its focus on emerging markets, primarily in South Africa.
“It has therefore gone back to its roots as a South African entity involved in asset management, short- and longterm insurance, with a major toehold in the affordable market,” Klipin said, adding that this would enable the company to be benchmarked against peers such as Sanlam, Momentum and Liberty Life.
“At this early stage as a standalone entity, it seems to represent a good long-term investment in a challenging operating environment with disposable income under pressure.
“The jewel in the crown from the unbundling could turn out to be Quilter, which has a primary listing in London and a secondary listing in South Africa. Quilter should therefore turn out to be a good rand hedge investment,” Klipin said.