Old Mutual to sell Nedbank stake?

Johannesburg - Rumours are again doing the rounds that Old Mutual could soon announce the sale of all or part of its 54% stake in Nedbank.

In a recent note to clients, analysts at Standard Securities said the fallout of the financial market meltdown has put pressure on financial services conglomerates, like Old Mutual, to break down into simpler and less complex operations.

"In the growing context of the disaggregation of global financial services conglomerates, we believe that Old Mutual may well look to sell part or all of its current stake in Nedbank," Standard Securities said.

Old Mutual declined to comment on the note, saying it was in a closed period ahead of its results reporting and hence could not comment on market speculation.

The call may also be treated with some cynicism, considering Standard Securities issued a "buy" recommendation on Nedbank while recommending rival FirstRand as a "sell".

Fondness for SA assets

Other market commentators said they had not heard anything recently to support such a rumour, but pointed out international banking group Standard Chartered had long sought an opportunity to enter the South African market through a sizeable acquisition.

An analyst commented that now that Old Mutual CEO Julian Roberts had been in the hot seat for a while, investors were anxious for him to explain how he would unlock value tied up in the group.

However, since taking charge at Old Mutual in late 2008, Roberts has shown a fondness for Old Mutual's highly profitable South African assets.

Roberts has recently completed a buyout of minorities in local short-term insurer Mutual & Federal, which is to be delisted shortly.

In late afternoon trade on Thursday, Old Mutual was down 1.1% (14c) to 1 251c per share while Nedbank was up 0.3% (35c) to trade at 12 340c. The financial services index was down 0.2% at 24 895 points.

- Fin24.com