By Carin Smith
Cape Town – Old Mutual [JSE:OML] confirmed on Monday that all options for its strategic review are being considered, but emphasised that no decision has been made yet.
The group said when its new CEO Bruce Hemphill joined on November 1 2015, it announced that a strategic review will be conducted. At the time of his appointment Hemphill said that he looked forward “to leading the executive team and the Group in the next stage of its development”.
The statement follows what it calls “media speculation”.
At the same time, Old Mutual’s banking arm Nedbank Group [JSE:NED] said in a statement it has had a longstanding commercial relationship with Old Mutual “that is a source of value underpinning the successful collaboration activities both in South Africa and the rest of Africa”.
According to Nedbank, it and Old Mutual have been engaging collaboratively as part of the ongoing strategic review being conducted by Old Mutual under Hemphill.
“Nedbank Group shareholders are advised to exercise caution when dealing in Nedbank Group securities until an update on Old Mutual’s strategic review is provided on March 11 2016,” the bank said.
Read also: Underperforming Old Mutual planning to break itself up, unbundle – report
Old Mutual’s share price surged on Monday, adding 8.91% to R42.67, while Nedbank gave up 0.43% to R189.68.
Old Mutual is set to announce its preliminary results for 2015 on March 11 and said will provide an update on the strategic review at that time.
Sky News reported on Sunday that Old Mutual is drafting a plan to split itself up into four standalone companies, namely Nedbank, its UK focused wealth unit, its emerging markets operation based in South Africa and its institutional asset management business.
Old Mutual Wealth is reportedly already being eyed by two buyout firms – Cinven and Warburg Pincus – for a multibillion pound joint cash offer. –Â Fin24
Source:Â http://www.fin24.com/
Old Mutual shares surge on break-up and bid talk
By Noor Zainab Hussain and Carolyn Cohn
March 7 (Reuters) – Anglo-South African financial services company Old Mutual said on Monday it was considering all options in a strategic review, with speculation of a break-up and takeover bids for its assets sending its shares soaring.
Sky News reported on Saturday the 9 billion pound ($12.8 billion) company was working on a plan to split itself up and that this could trigger a takeover battle for its operations which include banking, insurance and asset management.
Private equity firms Cinven and Warburg Pincus have tabled a multi-billion pound joint cash offer for Old Mutual Wealth, the firm’s British asset management business, Sky News said, without citing sources. Cinven, Old Mutual and Warburg declined to comment.
At 1130 GMT, Old Mutual shares were up 7.3 percent at 192.8 pence, the biggest rise by a European blue-chip stock.
The insurance and asset management sectors have seen several deals in recent years. Old Mutual Wealth, which analysts value at 3-4 billion pounds, bought money manager Quilter Cheviot in 2014, and sold fixed income asset manager Rogge last month.
Old Mutual announced a strategic review in November, after former Standard Bank executive Bruce Hemphill took over as chief executive.
It said on Monday it had not made any decisions, but would give an update with annual results on March 11.
Analysts and industry insiders said the firm may also consider listing Old Mutual Wealth, after it listed its U.S. asset management business in 2014.
Sky News said the group was looking to divide itself into four standalone companies comprising its stake in South African lender Nedbank Group Ltd, its UK-focused wealth unit, its South Africa-based emerging markets operation, and its institutional asset management business.
Nedbank said on Monday it was “engaging collaboratively” with Old Mutual as part of the review, but advised shareholders to “exercise caution” when dealing in Nedbank shares ahead of the update. Old Mutual has a 54.57 percent stake in Nedbank, according to Thomson Reuters data.
One Johannesburg-based analyst, who declined to be named, told Reuters that Old Mutual’s South African operations held little appeal for U.S. and European investors as it would expose them to swings in the value of the rand.
The firm beat third-quarter sales forecasts, boosted by record inflows into its wealth management unit. It also reported strong sales across its Africa and emerging markets operations, with the latter up 22 percent in local currency terms.