Picture: BLOOMBERG/DEAN HUTTON
Picture: BLOOMBERG/DEAN HUTTON

Financial services group Old Mutual’s share price fell 26% to R21.74 on Wednesday morning, as the company proceeds with the unbundling of its majority stake in Nedbank.

The sharp drop can be seen as a correction after Tuesday, which was the last day to trade in Old Mutual Shares pending the share exchange. Fractional entitlements for shares will be determined by Nedbank’s closing share price on Wednesday.

Old Mutual shareholders are set to receive 3.2116 Nedbank shares for every 100 Old Mutual shares, in a R50bn windfall for shareholders.

Tuesday was the last day to trade in Old Mutual Shares, while fractional entitlements for shares will be determined by Nedbank’s closing share price on Tuesday.

Old Mutual maintains that the unbundling will benefit shareholders  materially as well as by allowing investors to participate in differing investment cases.

Old Mutual, which houses the core emerging-market businesses, listed on the JSE in June, as part of the managed separation process. The emerging-market segment has insurance and asset-management businesses, predominantly in Africa, under its wing.

Correction: October 11 2018

An earlier version of this story incorrectly stated that Old Mutual's share price had fallen 26% to R74.21 on Wednesday morning. It had in fact fallen 26% to R21.74

gernetzkyk@businesslive.co.za

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