Old Mutual unbundles Nedbank shareholding

GIANT financial services group, Old Mutual, has announced the unbundling of 12,2 percent of its shareholding in Nedbank subject to regulatory approval.

In a trading update for the half-year ended June 30,2021, Old Mutual said: “Subject to regulatory approval, Old Mutual will unbundle all the Nedbank ordinary shares held by Old Mutual Emerging Markets Limited (being 62 131 692 Nedbank ordinary shares and comprising 12, 2 percent of the issued ordinary share capital of Nedbank).”

It said the remaining Nedbank stake held by Old Mutual Life Assurance Company South Africa (OMLACSA) continues to support the capital structure of OMLACSA and would be managed in line with the group’s financial management framework.

“In order to optimally manage the capital structure, we have entered into a zero-cost collar arrangement on the majority of the OMLACSA exposure to Nedbank,” said the group.

Following on the Old Mutual voluntary operating update on June 23, 2021, this trading statement for the period under review, provides an indication of a range for headline earnings per ordinary share and earnings attributable to equity holders of the group per ordinary share.

The group’s interim results will be released on the Stock Exchange News Service of the Johannesburg Stock Exchange Limited on 31 August 2021.

“The local and global equity markets have recovered given the improvement in corporate profits as lockdown restrictions have eased.

“Markets have rallied ahead of pre-Covid-19 levels. However, the environment remains volatile as we navigate the challenging impact of the pandemic.

“We continue to demonstrate agility in our response to the impact of the pandemic on our business, with good recovery in sales and earnings for the first half of the year,” said the group.

The mortality claims paid relating to Covid-19 in the life businesses are driving negative net client cash flows.

“However, this is offset by inflows in our asset management and wealth businesses.

“Our mortality experience has been worse than anticipated with impact on profits mitigated by a partial release of provisions raised at the end of 2020,” it said.

The group’s Covid-19 provisions have been increased by R2 billion as at June 30, 2021 to take into account the emerging expectations of wave three and four as well as potential future waves.

“The provisions have been updated to take into account the additional available data to date as well as the anticipated impact of the proposed vaccination rollout plan,” said Old Mutual. — chronicle.cl.zw