UK division to stand on own two feet in split at Old Mutual
Old Mutual’s UK funds business will go it alone after the FTSE 100 giant confirmed plans to break up its sprawling Anglo-African empire.
The London-listed Old Mutual will cease to exist after it confirmed a plan to separate its four companies into standalone businesses.
One of those, the UK-based Old Mutual Wealth (OMW), will be sold to another company or listed on the stock market. The other three – Old Mutual Emerging Markets, Nedbank and Old Mutual Asset Management – will also be separated.
Nedbank and OMAM are already listed in Johannesburg and New York respectively, with Old Mutual owning majority stakes.
The separation is due to complete by the end of 2018.
Few concrete details emerged today of how the break-up will work, but Old Mutual’s chief executive Bruce Hemphill said cuts could come at its London head office.
He will also be out of a job following the demerger.
OMW, the UK arm, said the separation will allow it to be independent. Its chief executive Paul Feeney explained: “The Old Mutual group has been incredibly supportive but there is very little synergy between my business and those in South Africa. We stand on our own.
“At the moment we have to share a corporate structure, which is an overhead for us. But we are different companies.”
Old Mutual was founded 170 years ago in South Africa but has since grown into a sprawling empire.
Under the plans unveiled yesterday, Old Mutual will cut its 65 per cent stake in Nedbank to a minority holding.
Its interest in OMAM will also be offloaded.