Published: Thursday, 08 November 2007 18:20
Old Mutual plc confirms that it is currently in discussions with community–based investment group, RBH which may result in the sale by Old Mutual to RBH of a controlling interest in Mutual & Federal Insurance Company Limited, the short–term insurer in which Old Mutual has a majority stake.
Old Mutual plc (“Old Mutual”) confirms that it is currently in discussions with community–based investment group, Royal Bafokeng Holdings (Proprietary) Limited (“RBH”), which may result in the sale by Old Mutual to RBH of a controlling interest in Mutual & Federal Insurance Company Limited (“Mutual & Federal”), the short–term insurer in which Old Mutual has a majority stake. If the potential offer proceeds, RBH would make an offer for all of the issued share capital of Mutual & Federal and Old Mutual would undertake to accept it in relation to a minimum of 60% and a maximum of 70% out of its overall approximately 75% stake in Mutual & Federal.
The indicative offer price for this transaction (which is subject to satisfactory due diligence by RBH) is R27.50 per share, to be reduced to reflect any dividends (and associated taxes) paid by Mutual & Federal prior to the closing of the potential offer, and to be adjusted upwards for the time value of money between today’s date and settlement. The indicative offer price represents an approximate 5% premium to the 30–day volume weighted average market price of Mutual & Federal shares for the period up to 2 November 2007.
If the potential offer were made and was successful, RBH would become the majority shareholder in Mutual & Federal, but Old Mutual has been informed by RBH that it would not seek to acquire minorities’ shares compulsorily and would maintain Mutual & Federal’s listings on the JSE Limited and the Namibian Stock Exchange, subject to their respective listings requirements.
Full details of the potential offer by RBH for Mutual & Federal are expected to be announced in mid–December 2007.
For further information, please contact:
Aleida van Herel
UK: +44 (0)20 7002 7287
SA: +27 (0)21 509 8709
UK: +44 (0)20 7002 7133
SA: +27 (0)82 553 7980
Notes to Editors
Mutual & Federal
Mutual & Federal provides insurance services to the personal, commercial and corporate markets in South Africa, Namibia, Botswana and Zimbabwe.
Old Mutual owns 75% of Mutual & Federal Insurance Company Limited on a fully-diluted basis, after taking account of Mutual & Federal’s BEE ownership transactions. Mutual & Federal’s shares are listed on the JSE Limited and the Namibian Stock Exchange.
Royal Bafokeng Holdings - (RBH)
RBH is the primary investment vehicle of the Royal Bafokeng nation, a community of approximately 300,000 Tswana-speaking people with substantial holdings of mineral-rich land in the North West province of South Africa.
RBH has significant capital derived from the leasing of mining rights to the largest platinum mining companies in South Africa. RBH has declared its intention to diversify its income stream by investing in assets such as property, industrial and financial services companies. The intended acquisition of a majority stake in Mutual & Federal represents an opportunity to develop this strategy.
For further information on RBH, please visit www.bafokengholdings.com
Old Mutual plc is an international savings and wealth management company based in the UK. Originating in South Africa in 1845, the group has a balanced portfolio of businesses offering sset management, life assurance, banking and general insurance services in over 40 countries, primarily South Africa, Europe and the United States. Old Mutual is listed on the London Stock Exchange and the JSE Limited, among others.
In the year ended 31 December 2006, the group reported adjusted operating profit of £1.4 billion (on an IFRS basis). Old Mutual had £263 billion of funds under management and 53,000 employees at 30 June 2007.
For further information on Old Mutual plc, please visit the corporate website at www.oldmutual.com.