Shares in Old Mutual booked their biggest one-day gain in nine months, adding almost R4bn to its market value, as investors cheered the news that the insurer will distribute a portion of its stake in Nedbank.

Old Mutual, which traces its roots back to the mid-19th century as SA’s first mutual aid society with 166 members, will hand shareholders 12.2%, valued at just over R10bn, of its 19.4% stake in Nedbank, it said after the market closed on Wednesday...