DAVID LUHNOW, London | Wednesday
DESPITE a busy first six months, Anglo-South African insurer Old Mutual is still eyeing opportunities in the US, UK and emerging markets, company officials said.
It had lost its bid for Edinburgh-based mutual assurer, Scottish Provident, which industry sources say has agreed to 2bn deal with the UK’s Abbey National Plc.
Old Mutual would continue to look for ways to expand the business out of its South African stronghold through both internal growth and acquisitions.
”There’s a limited number of [UK] target companies that we are interested in. We will continue to look for the opportunity to grow the business and acquire businesses,” said Julian Roberts, the group’s finance director.
The group has been busy this year buying US-based United Asset Managers (UAM) in June for $1.46bn, only a few months after buying UK asset manager Gerrard Group for 525m.
It also recently announced a joint venture in India with Kotak Mahindra Finance Ltd to sell life policies.
Due to the acquisitions, a quarter of the company’s business in pro forma terms in 2001 will be from areas outside South Africa – a goal the company had set for several years hence.
Analysts said diversification could help the company lift the rating on its shares – which trade very near the group’s embedded value compared with a premium on most life companies.
Company officials spoke to journalists after the firm reported a 61% rise in operating profits, based on a long-term investment return, to 457m.
Because of a weak Johannesburg stock market and a decline in the exchange rate of rand versus the pound, the group’s embedded value declined to 5.2 billion during the year’s first six months.
”I am comfortable growth will resume in South Africa. The company could also grow in areas where its market share is weaker, such as high-income customers,” Levett said, adding that the economy was on solid footing. – Reuters