Old Mutual shareholders to get $3.5 bln from Nedbank spin-off

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South Africa’s Old Mutual Ltd said on Wednesday its shareholders would get 50 billion rand ($3.5 billion) from the spin-off of a majority stake in Nedbank and dividends.

The 173-year-old group has been dismantling its conglomerate structure, created after a series of acquisitions, since it moved its headquarters and primary listing to London in 1999.

Chief Executive Bruce Hemphill set the break-up in motion in 2016, saying the company’s four main businesses – a U.S. asset manager, a British wealth manager, an African financial services division and a South African bank – would be valued more highly by investors as separate entities.

Old Mutual holds 52 percent of Nedbank and after the spin-off on Oct. 15 will hold around 19.9 percent, it said in a statement.

“The Old Mutual board believes that the Nedbank Unbundling continues to be in the best interests of Old Mutual shareholders as it allows investors to participate in the substantially different investment cases of Old Mutual and Nedbank,” it said.

Shareholders will receive 43.2 billion rand from the spin-off and 7.1 billion rand in interim and special dividends that will be paid on Oct. 16, the company said.

They will get approximately 3.2 Nedbank shares for every 100 Old Mutual shares they own.

Shares in Old Mutual were up 1.56 percent to 30.68 rand at 1331 GMT, while Nedbank edged 0.34 percent lower to 262.31

The Nedbank spin-off is the final step in the group’s break up, which was mostly completed in the six months ended June 30.

The group returned to its South African roots in June when it listed its African financial services business in Johannesburg.