Old Mutual said yesterday it would unbundle all the Nedbank shares held by Old Mutual Emerging Markets, comprising some 12.2 percent of the share capital of Nedbank.
The unbundling to Old Mutual shareholders, worth some R10.3 billion based on Nedbank’s market capitalisation yesterday, would be by way of a distribution in specie.
Old Mutual had maintained a minority 19.4 percent shareholding in Old Mutual following the conclusion of Old Mutual’s managed separation process in 2018.
This level of the Nedbank stake was determined through discussions with Nedbank and regulators at the time in order to ensure cohesive alignment with the ongoing arms’ length commercial arrangements between Old Mutual and Nedbank, and to support the capital structure of the Old Mutual group.
Old Mutual said it had been committed as a significant minority shareholder of Nedbank and had retained a right to review the stake from time to time, in accordance with the protocols outlined in the relationship agreement concluded between Nedbank and Old Mutual in April 2018.
Disposing of the stake would simplify the group, allowing investors to focus on the core operations of Old Mutual, allows shareholders to participate more directly in the investment cases of Old Mutual and Nedbank; and provide a substantial return of capital to shareholders. – Edward West