UNBUNDLING BEHIND DECLINE

OLD MUTUAL Limited (OMU) fell more than 26 percent in early trade on the JSE yesterday, a move analysts attributed to the managed separation it embarked on last year. The share price ended the day 1.01 percent higher on the JSE at R21.55. Jordan Weir, a trader at Citadel said the main reason for this was the unbundling of Nedbank from the Old Mutual Limited security listed on the JSE. “This is simply part of the original unbundling strategy being rolled out by Old Mutual Plc, which started last year. The share, however, fell a bit further than expected on the day,” Weir said. He added it was assumed the price should fall roughly 20 percent yesterday as part of the unbundling. “However, the rocky sentiment prevailing in emerging markets as well as South Africa’s current political situation seems to have created more of a drag than expected on OMU’s share price,” Weir said. Last month, OMU announced that it would return R46.8 billion to its shareholders after the unbundling. The unbundling follows the managed separation announced by Old Mutual plc chief executive Bruce Hemphill in March 2016. He said the move was aimed at unlocking value currently trapped within the group structure. OMU is focusing on emerging markets, and Quilter, previously known as Old Mutual Wealth, listed separately in June with former Old Mutual Asset Management re-branding as BrightSphere Investment Group, a USbased asset manager. | Sandile Mchunu