Old Mutual separation is on track – Nedbank
NEDBANK Group said yesterday that the managed separation of Old Mutual Plc (OMP) was progressing well on schedule.
The separation gained momentum with the primary listing of Old Mutual Limited (OML) on the JSE and also on the London Stock Exchange, the Namibian Stock Exchange, the Zimbabwe Stock Exchange and the Malawi Stock Exchange on June 26.
Nedbank chief operating officer Mfundo Nkuhlu said the unwinding of OMP was already under way after the listing of Quilter and OML on the JSE and London Stock Exchange.
“This process will be completed when OML’s shareholding in Nedbank is reduced to a 19.9 percent strategic minority shareholding in Nedbank Group. We have about five months remaining in that process and, as we said earlier, the process will be completed at the end of the year,” Nkuhlu said.
The managed separation, which was announced by OMP chief executive Bruce Hemphill in March 2016, was done to unlock value currently trapped within the group structure. OML will reduce its stake from 53 to 19.9 percent by the end of 2018. The managed break succeeded in separating former Old Mutual Wealth from the group listed separately as Quilter.
OML, focusing on emerging markets, recently listed with former Old Mutual Asset Management re-branded as BrightSphere Investment Group, a US-based asset manager.
Nedbank said the listing of OML was the precursor to the third and final step of the managed separation and entailed the reduction in OML’s shareholding in Nedbank Group through the distribution of Nedbank Group ordinary shares to OML’s shareholders.
“This will result in OML, immediately after the implementation of distribution or unbundling, holding a 19.9 percent strategic minority shareholding in Nedbank Group,” the group said.
After the unbundling it was expected that OML shareholders would receive three ordinary shares in Nedbank Group for every 100 OML shares held.
Currently Nedbank said it continued to operate on a business-as-usual basis and the managed separation would have no impact on its strategy, its day-to-day management or operations, its staff or clients.
“Our engagements with Old Mutual have been at arm’s length and are overseen by independent board structures. Old Mutual operates predominantly in the investment, savings and insurance industry, which has little overlap with banking, even though we compete in the areas of asset management and personal loans,” Nedbank said.