Old Mutual Seeks Mutual and Federal Ownership

October 20 - In a bid to optimize internal efficiencies within the group, Old Mutual Plc announced that it would be seeking to make an offer to acquire the remaining shares of its subsidiary company, Mutual & Federal.

At present, Old Mutual owns 73.5% of Mutual & Federal shares, and is seeking to take over the group completely to a full 100%.

"The offer is part of Old Mutual's focus on driving value creation and optimizing internal efficiencies across the group," said the Group Chief Executive Officer of Old Mutual, Julian Roberts.

"A successful acquisition of the minority shares will unlock capital synergies for both parties and will also leverage additional capabilities across the Old Mutual group," he added.

A proposal has been made to acquire the additional shares via a scheme arrangement based on just over R21 per share.

"In line with the regulatory requirements, the Mutual & Federal board has appointed JP Morgan as independent experts to advise on the financial terms of the offer," said the Managing Director of Mutual & Federal, Keith Kennedy.

"JP Morgan's opinion will be made public in due course," he said. "In addition, the board has convened a sub committee of independent directors to consider the offer. After considering the opinion of JP Morgan and the recommendations of the sub committee, the board will advise shareholders of its recommendations in due course."

Shareholders who represent the remaining stocks in Mutual & Federal have already given their word to vote in favour of the takeover offer at a general meeting next month.

These shareholders will have the option to become shareholders in the Old Mutual Group at a rate 21% above average price.