Share price: R22.74 JSE code: OMU
its HOLD managed OLD separation MUTUAL HAS and has COMPLETED unbundled both Quilter, its UK and US focused asset management firm, and Nedbank, one of the largest banks in SA, from its share.
During the final phase, when Nedbank shares were unbundled, Old Mutual shares fell a bit harder than expected: about 26% vs the expected 20% mark.
What remains within the stable is a pan-African investment, savings and insurance group with a strong focus on exploring financial services opportunities in Africa. Though in the medium term the weaker rand may have a negative impact on Old Mutual, as it falls in the financial sector which is generally negatively hit by a weaker rand and no longer has UK and US businesses to offset rand weakness, the focus on a measured expansion into Africa will give Old Mutual access to a huge pool of previously unserved customers.
Much as Capitec has banked the unbanked, Old Mutual plans to provide insurance, savings and investment products to a market that has largely never had access to such products. So it might be prudent to allow Old Mutual time for this pan-African expansion to gain momentum.
For now, there is no compelling case to buy aggressively, but if its ambitions come to fruition, there could be value in this stock. Patience will be required though.