Chunk of stake sold by Old Mutual
Old Mutual has sold the final tranche of its large interest in Old Mutual Asset Management to China’s HNA Capital, retaining only 5.5% in its US arm.
The insurer sold 24.5% of its 50.8% interest in the asset manager in two phases for combined proceeds of $446m.
Between the first tranche and the final tranche, Old Mutual sold the bulk of its holding through a public offering, leaving it with a 5.5% share.
This stake "should be viewed as a liquid asset available for realisation", according to Rob Leith, the insurer’s director of managed separation.
Old Mutual is in the middle of separating its four core businesses — OM Asset Management, Nedbank, emerging markets and wealth — into independent businesses, with wealth and emerging markets set to be listed in 2018.
As its asset management arm and Nedbank are already listed, it is selling down its stake in OM Asset Management and plans to unbundle its 54% share in Nedbank to shareholders in a new holding company that will house emerging markets and the bank, retaining 19.9% of Nedbank.
Old Mutual said the transaction had unlocked more value for the company, representing a further step in delivering its managed separation strategy.
The deal had also secured a strategic long-term investor for OM Asset Management.
HNA Capital – together with parent company HNA Group – has been on a shopping spree for some time and has either snapped up shares or announced deals in financial services companies such as SkyBridge Capital, the investment company founded by Anthony Scaramucci, US President Donald Trump’s former communications director.
The $180m deal is still to pass regulatory muster.
HNA Group has also agreed to buy UK foreign exchange provider International Currency Exchange for an undisclosed sum and has secured a $460m deal for Australia & New Zealand Banking Group’s UDC Finance, a car and equipment loan provider.
"We are pleased to welcome HNA Capital US as a new, supportive investor in OM Asset Management," said James Ritchie, the chairman of OM Asset Management.
"We remain focused on executing our growth strategy, which includes working collaboratively with our high-quality affiliates to diversify their businesses and expand their global distribution opportunities, as well as acquiring new affiliates to generate strong, long-term value for all of our shareholders," he said.