Cape Town - Old Mutual [JSE:OML] announced on Wednesday it is reducing its stake in the Nedbank Group [JSE:NED] from 54% to 19.9%.
This forms part of its "managed separation plan", first announced in March 2016, to separate Old Mutual's four constituents - Old Mutual Emerging Markets, the Nedbank Group, Old Mutual Wealth and Old Mutual Asset Management – into standalone entities.
Nedbank said in a statement that the 19.9% investment would be held by Old Mutual Limited (OML), a new SA holding company that will also house Old Mutual Emerging Markets and what is left of Old Mutual after the unbundling.
Nedbank said OML expects to list on the Johannesburg Stock Exchange in 2018 “at the earliest opportunity”. It will also have a secondary listing on the London Stock Exchange.
OML will not be selling its stake to a new investor.
“As previously announced, the decrease in OML’s shareholding in Nedbank Group to 19.9% will be achieved through the distribution of the balance of OML’s majority shareholding in Nedbank Group to its shareholders, at an appropriate time and in an orderly manner, post the listing of OML," Old Mutual and Nedbank said in a joint update to shareholders.
This means the reduction of the stake will only take place in 2018.
“OML does not intend to sell any part of its shareholding in Nedbank Group to a new strategic investor,” it added.
In a separate statement on Wednesday, OML CEO-designate Peter Moyo said the new holding company would list on the stock exchanges of Malawi, Namibia and Zimbabwe in 2018, as well as the JSE and the LSE.
“We have strong positions in key segments, underpinned by a breadth of product offerings, and multi-channel distribution,” he said.
“Furthermore, we see substantial opportunities to drive growth through operational leverage and efficiencies and an enhanced and simplified customer experience.”
Old Mutual shares were trading 1.74% up at R36.29 on the JSE just after 14:00.
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