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Investec to spin off asset management arm by March
Posted on Monday, 02 December 2019 11:51
Investec expects to complete the spin-off and public flotation of its global asset management arm by March 2020 as the Anglo-South African financial group seeks to focus on its banking and wealth operations.
The unit will be known as Ninety One following the separation, which will be implemented by way of a demerger to a new, dual-listed company structure (DLC).
A 10.0 per cent stake will be sold to new or existing institutional and certain other investors following a secondary cash placing expected to be carried out on the same day as admission.
Ninety One plc will be incorporated in England and Wales, have a premium listing on the London Stock Exchange and a secondary inward one on the Johannesburg Stock Exchange.
South Africa-registered Ninety One Limited is expected to have a primary listing on the Johannesburg Stock Exchange.
Investec expects to retain 15.0 per cent of the combined total issued share capital of the DLC, and its existing plc and Ltd shareholders will own a 55.0 per cent interest.
Management and directors are participating in the resulting entity via the investment vehicle Forty Two Point, which will have a 20.0 per cent stake.
Investec said core benefits of the spin off include Ninety One becoming a “truly independent global asset management business”, which will be “better positioned to achieve its growth ambitions”.
Not only will the separated entity have strategic “flexibility to create value over the long-term” but its enhanced profile is also expected to attract new clients.
Investec plc noted the demerger will positively impact the common equity tier (CET) one ratio, which could improve by about 1.3 per cent to 12.0 per cent, as at 30th September 2019 on a pro forma basis.
Meanwhile, Investec Ltd’s CET one ratio may rise by 0.6 per cent to 12.3 per cent, on a pro forma basis, as at 30th September 2019.
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