Obituary: Mike Levett of Old Mutual
● When former Old Mutual boss Mike Levett, who died in Cape Town on August 30 at the age of 81, demutualised the insurance and investment entity in 1999 and headed to the UK to launch its primary listing in London, he famously described the controversial move as a “win, win, win” situation for Old Mutual, for its policyholders and for Southern Africa.
In fact it was a value-destroying disaster for all three. The only clear winners were the group’s executives, who received generous sterling-denominated remuneration packages.
Comparing their rand remuneration prior to the move to London with the spectacular benefits Levett and his senior colleagues reaped after the move led cynics to wonder if this was the real motive behind the move.
Levett’s plan was to use the money from the listing to finance an acquisition spree that would make Old Mutual a global player in the financial services industry.
It soon became obvious that although his executives understood the South African market well enough to be very successful in what was a fairly isolated, protected domestic environment, they were novices when it came to the unforgiving global environment.
Levett, who led Old Mutual into its 1999 London listing as executive chair and CEO, was not alone among South African executives who assumed their success in SA could be replicated on the world stage. Instead he found himself competing with the likes of Goldman Sachs and was eaten for breakfast. He overpaid for acquisitions in the UK and US that lost Old Mutual vast amounts of money and created unsustainable situations, which his successors were burdened with having to clean up, minimise or exit at huge cost in time and resources.
Shareholders fumed at the heavy cost of the expansion strategy he’d so confidently outlined and analysts called on him to walk the plank, but the increasingly invisible CEO and executive chair refused to accept responsibility.
The relocation (to an exorbitant building in London with a fantastic view over the Thames), London listing and UK and US transactions were decided by the executive committee and the full board, he said.
Analysts and former executives who knew him as an autocrat who dominated the board and treated Old Mutual as his private fiefdom didn’t buy this and, together with shareholders, ratcheted up the pressure on him to go.
His retirement was announced in 2005.
He also left the board of Old Mutual subsidiary Nedcor, which under his watch had become a shambles.
By the time Levett retired there was no evident business case for Old Mutual to stay, but it was only in 2018 that it finally closed its London operation, which by then was reportedly costing $200m (R3.3bn) a year, and returned its head office to SA.
Levett was born in Cape Town on June 6 1939. He matriculated at Christian Brothers College in Sea Point and began working at Old Mutual at the age of 19 while he was doing a BCom at the University of Cape Town.
He qualified as an actuary in London and Edinburgh and in 1969 and 1970 did an MBA at the UCT Graduate School of Business, where he was awarded a gold medal for being top student.
He took over as MD of Old Mutual in 1985 from the dominant Jan van der Horst, who had built the insurer into a huge industrial conglomerate.
Levett never had the same public profile as his predecessor, who died in 2003.
Most people continued to associate Old Mutual with Van der Horst long after Levett became MD.
After leaving Old Mutual he continued living in his flat in Earls Court, London, spending four months or so a year in Cape Town.
Levett, who died of a heart attack, is survived by three children. His wife Jill died in 2019.