Investec sets date for asset management listing


Investec sets date for asset management listing

Published Date: 2019-12-02 | Source: Stephen Gunnion | Author: Stephen Gunnion

Investec sets date for asset management listing

Investec plans to sell a stake in Ninety One in a secondary cash placing when it lists in the middle of March.

Investec plans to sell a 10% stake in its asset management business to new and existing investors when it lists it on the JSE and London Stock Exchange. It's set the demerger date for Friday 13 March, with shares in the renamed Ninety One expected to start trading on 16 March.

In an update on Friday as it published its circular to shareholders, the group said it was making good progress with the separation of Investec Asset Management. The transaction has been approved by the JSE and the UK's Financial Conduct Authority, but still needs the consent of shareholders at a general meeting on 10 February. It said the demerger would enhance the long-term prospects of both businesses for the benefit of shareholders, clients, employees and other stakeholders as they would be more focused on their respect growth paths.

In addition to the 10% of the combined JSE and LSE-listed shares that will be sold in a secondary cash placing, about 20% of Ninety One will be held by Forty Two Point One, an investment vehicle through which the asset manager's directors and management participate in the business. Funds raised from the share sale will be retained by Investec and used to strengthen the capital position of the remaining Investec Bank and Wealth business, as well as funding any tax liabilities and other costs arising from the transaction. Investec will retain a small stake in Ninety One.

Investec's shareholders will retain their existing shareholding and receive one Ninety One plc share for every two Investec plc shares and/or one Ninety One Limited share for every two Investec Limited shares held. That will give them about 55.9% of Ninety One plc and around 53.1% of Ninety One Limited. They will also receive dividends from both companies from the financial year ending March 2021. Ninety One is targeting an ordinary dividend pay-out ratio of at least 50% of operating earnings adjusted for tax. Investec Bank and Wealth is targeting a dividend pay-out ratio of 30% to 50% of adjusted earnings per share in pounds sterling.

Investec Limited fell 1.8% to R84.21 on Friday while Investec plc shed 1.4% to R83.84.

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