Old Mutual sells single strategy
December 19, 2017

Old Mutual Wealth today announces that it has agreed to sell its Single Strategy asset management business (Single Strategy business) to the Single Strategy Management team and funds managed by TA Associates, the global growth private equity firm (together the acquirer), for an expected total consideration of around £600 million, comprising cash consideration of £570 million payable on or before completion, with approximately  £30 million anticipated to be payable thereafter, paid primarily in 2019 to 2021 as surplus capital associated with the separation from Old Mutual Wealth is released in the business.

Old Mutual says this deferred consideration is not subject to performance conditions. Once the transaction completes, economic ownership of the Single Strategy business will pass to the acquirer effective from January 1 with all profits and performance fees generated up until December 31 for the account of Old Mutual Wealth. It adds that the Single Strategy business will be appropriately capitalized to continue to implement its growth plans during this transitional ownership phase.

As at September 30, funds under management for the Single Strategy business were £25.7 billion, and net client cash flow (NCCF) for the nine months to September 30 was £3.5 billion. Adjusted operating profits for the six months to June 30 were £36 million, of which £17 million were performance fee related. Profits before tax for the year to December 31, 2016 were £60 million (of which £26 million were performance fee-related) and gross assets were £198 million at that date.

The proposed transaction is subject to customary closing conditions, including regulatory approvals and conditions relating to the transfer of the multi-asset business to be retained by Old Mutual Wealth. A number of operational and IT transitional service agreements have also been agreed for a period of up to two years from the date of the completion of the sale (covering the separation of the retained Multi-asset business from the Single Strategy business). The majority of the current management team of the Single Strategy business, including CEO Richard Buxton, will remain with the Single Strategy business.

Proceeds from a completed transaction will be used for general corporate purposes following finalization of Old Mutual Wealth's capital and liquidity requirements as a standalone listed entity as part of the broader Managed Separation of Old Mutual plc.

Background to and rationale for the transaction

On September 3, 2017, Old Mutual Wealth announced the creation of the multi-asset business, together with the exploration of internal and external structures for the Single Strategy business to continue to develop it further. The announcement of this transaction follows a rigorous review process, which included interest from a number of market participants.

There is no change to the Old Mutual Wealth multi-asset business, which will be rebranded as Quilter Investors. Led by Paul Simpson, Chief Executive Officer, this business is a core part of the Old Mutual Wealth strategy, delivering leading investment solutions to a wide number of UK and international retail clients through Old Mutual Wealth's significant distribution footprint.

As at September 30, FUM for Old Mutual Wealth, excluding the Single Strategy business, were £106.6 billion and NCCF for the nine months to September 30 was £4.1 billion.

Paul Feeney, Chief Executive Officer of Old Mutual Wealth, said: "Ahead of our managed separation and proposed listing in 2018, we are pleased that we have completed the strategic review of the Single Strategy business and agreed terms for a transaction with TA Associates. As we outlined in the Showcase event in November, the Single Strategy business is less closely aligned to our goal of becoming the UK's leading wealth manager. I believe this development is a good outcome for our shareholders and provides the Single Strategy team with a great opportunity to build on the success they have achieved since 2012."

Richard Buxton, CEO of the Single Strategy business, added: "The management team is delighted to be partnering with TA Associates to buy the single strategy business. I believe this is a good outcome for our customers and our staff."

Chris Parkin, a Managing Director at TA Associates, said: "We have followed the development of Old Mutual Global Investors' Single Strategy business for several years and have been impressed by what is clearly now a diversified and high-quality investment platform. In particular, the well regarded fund management teams have worked diligently to develop and deliver tailored investment solutions focused on the needs of their customers, with the goal of producing positive long-term outcomes." 





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Old Mutual Wealth today announces that it has agreed to sell its Single Strategy asset management business (Single Strategy business) to the Single Strategy Management team and funds managed by TA Associates, the global growth private equity firm (together the acquirer), for an expected total consideration of around £600 million, comprising cash consideration of £570 million payable on or before completion, with approximately  £30 million anticipated to be payable thereafter, paid primarily in 2019 to 2021 as surplus capital associated with the separation from Old Mutual Wealth is released in the business.

Old Mutual says this deferred consideration is not subject to performance conditions. Once the transaction completes, economic ownership of the Single Strategy business will pass to the acquirer effective from January 1 with all profits and performance fees generated up until December 31 for the account of Old Mutual Wealth. It adds that the Single Strategy business will be appropriately capitalized to continue to implement its growth plans during this transitional ownership phase.

As at September 30, funds under management for the Single Strategy business were £25.7 billion, and net client cash flow (NCCF) for the nine months to September 30 was £3.5 billion. Adjusted operating profits for the six months to June 30 were £36 million, of which £17 million were performance fee related. Profits before tax for the year to December 31, 2016 were £60 million (of which £26 million were performance fee-related) and gross assets were £198 million at that date.

The proposed transaction is subject to customary closing conditions, including regulatory approvals and conditions relating to the transfer of the multi-asset business to be retained by Old Mutual Wealth. A number of operational and IT transitional service agreements have also been agreed for a period of up to two years from the date of the completion of the sale (covering the separation of the retained Multi-asset business from the Single Strategy business). The majority of the current management team of the Single Strategy business, including CEO Richard Buxton, will remain with the Single Strategy business.

Proceeds from a completed transaction will be used for general corporate purposes following finalization of Old Mutual Wealth's capital and liquidity requirements as a standalone listed entity as part of the broader Managed Separation of Old Mutual plc.

Background to and rationale for the transaction

On September 3, 2017, Old Mutual Wealth announced the creation of the multi-asset business, together with the exploration of internal and external structures for the Single Strategy business to continue to develop it further. The announcement of this transaction follows a rigorous review process, which included interest from a number of market participants.

There is no change to the Old Mutual Wealth multi-asset business, which will be rebranded as Quilter Investors. Led by Paul Simpson, Chief Executive Officer, this business is a core part of the Old Mutual Wealth strategy, delivering leading investment solutions to a wide number of UK and international retail clients through Old Mutual Wealth's significant distribution footprint.

As at September 30, FUM for Old Mutual Wealth, excluding the Single Strategy business, were £106.6 billion and NCCF for the nine months to September 30 was £4.1 billion.

Paul Feeney, Chief Executive Officer of Old Mutual Wealth, said: "Ahead of our managed separation and proposed listing in 2018, we are pleased that we have completed the strategic review of the Single Strategy business and agreed terms for a transaction with TA Associates. As we outlined in the Showcase event in November, the Single Strategy business is less closely aligned to our goal of becoming the UK's leading wealth manager. I believe this development is a good outcome for our shareholders and provides the Single Strategy team with a great opportunity to build on the success they have achieved since 2012."

Richard Buxton, CEO of the Single Strategy business, added: "The management team is delighted to be partnering with TA Associates to buy the single strategy business. I believe this is a good outcome for our customers and our staff."

Chris Parkin, a Managing Director at TA Associates, said: "We have followed the development of Old Mutual Global Investors' Single Strategy business for several years and have been impressed by what is clearly now a diversified and high-quality investment platform. In particular, the well regarded fund management teams have worked diligently to develop and deliver tailored investment solutions focused on the needs of their customers, with the goal of producing positive long-term outcomes." 



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