EMMA THOMASSON, Johannesburg | Thursday 4.10pm
INSURANCE and financial services group Old Mutual Plc on Thursday released its long-awaited prospectus of its plans to list on in London and Johannesburg — detailing a listing on July 12 with a market capitalisation of at least 3,65 billion.
Old Mutual said it will issue 2,97-billion shares to its 3,2-million policy holders and sell a further 297-million shares, priced in a range of 112 to 142 pence each.
Analysts expect the issue of shares to policy holders to help lift spending in the battered South African economy. ”The demutulisation and listing of Old Mutual represents a significant exercise in the economic empowerment for southern Africa,” chairman Mike Levett said in a statement.
The company said that the estimated share price range and market capitalisation will be updated on June 11 and finalised on listing day July 12. It cautioned that listing could be postponed if market conditions are unfavourable. Old Mutual said it will use the new capital raised to repay 120-million of debt it incurred when it bought British brokers Capel-Cure Myers and Albert E Sharp.
The new cash would also finance the cost of demutualisation, and provide further capital of 70-million to back foreign operations and fund future development.
Old Mutual said that as of December 31, 1998 the group’s total assets were 32 billion, and said that assuming it had listed at the beginning of 1998, the board would have expected to recommend total dividends of three pence per share, giving a notional dividend yield of 2,4%.
The group said it aims to maintain and develop its leading market position in SA, grow its profitability and reduce costs, expand internationally in selected markets and support its subsidiaries – Nedcor and Mutual & Federal. — Reuters