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Old Mutual Wealth up for sale

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Old Mutual is planning to break up its £9bn business as private equity firms put forward a multi-billion pound bid for Old Mutual Wealth.

Sky News reports the FTSE 100 company proposes to break itself four standalone companies: Old Mutual Wealth; a division comprising its stake in South African lender Nedbank; its South African-based emerging markets arm and its institutional asset management business.

Private equity firms Cinven, the majority shareholder in Partnership, and Warburg Pincus are believed to have tabled a joint cash offer for Old Mutual Wealth.

Old Mutual Wealth includes the network Intrinsic Financial Services, the asset management business Old Mutual Global Investors, and discretionary manager Quilter Cheviot.

It is reported details of the break-up plan could be set out in Old Mutual’s annual results on Friday.

Old Mutual, Cinven and Warburg Pincus declined to comment.

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Comments

There are 8 comments at the moment, we would love to hear your opinion too.

  1. One would like to know what drives this. Are they not making a decent return?

    So all the retail financial services of OM may go to Private Equity. Will this be good for the clients? Will Private Equity be more concerned with their returns rather than the returns of those with pensions and investments? Will there continue to be sufficient investment in platforms infrastructure, service and personnel? Skandia and then Old Mutual had/have a service proposition that I always found to be light years ahead of the competition. Will the regulator be keeping a very close eye on this? (I certainly hope so).

    I think this is a sad day. No doubt the staff are wondering too. I’d love to know what Paul Bradshaw and Peter Mann think.

    • Ah, Harry you take me back to my youth, although I fear neither I nor Skandia are as young as we were. You ask what I think, well truthfully I think the business should be floated on its own under paul feeney’s leadership. As a shareholder (small!) I would much rather capture the value of the business unconstrained by an owner with a different agenda ( at last!) than let a PE pay cash for it and then capture the value themselves. And I suggest the problem with PE ownership is they think in a five year timescale – neither your business nor your clients have such short horizons.

      Finally, just a thought, but is nucleus the only stably owned platform in the uk just now ( by advisers of course!)

  2. Agree Harry ! this is very concerning I am not convinced Private Equity firms have a place in financial services.

  3. The VC’s will bring together a business model that works, the days of non-performing Networks or Financial Service Company’s are well and truly numbered. Size does really matter now.

  4. Harry , I liked Paul B’s comments. Only time will tell what the outcome will be , but I do know one thing. Paul Feeney and his team will have the customers close to their hearts when he and his team decide what is right path to propose .
    P

  5. Julian Stevens 7th March 2016 at 5:07 pm

    Originally, and for many years, Skandia, then Selestia, then back to Skandia, then Old Mutual ~ what next? Too many changes are decidedly unsettling for investors, as we know from the level of public confidence in pensions.

  6. @Paul & Peter

    An MBO would indeed be nirvana. (My £50 note is ready!)

  7. The margins for Providers on Platforms are slim. Older Platforms face large costs to upgrade affecting the returns as Ian Gotts says mass is critical for going forward

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