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OLD MUTUAL PLC - Old Mutual Plc Agrees to Sell a Minority Stake in OMAM to HNA Capital US

Release Date: 27/03/2017 08:00
Code(s): OML     PDF:  
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Old Mutual Plc Agrees to Sell a Minority Stake in OMAM to HNA Capital US

   OLD MUTUAL PLC
   ISIN CODE: GB00B77J0862
   JSE SHARE CODE: OML
   NSX SHARE CODE: OLM
   ISSUER CODE: OLOMOL
   Old Mutual plc

   Ref 59/17
   25 March 2017


   OLD MUTUAL PLC AGREES TO SELL A MINORITY STAKE IN OMAM TO HNA CAPITAL US

   Old Mutual plc (“Old Mutual”) today announced that it has agreed to sell a 24.95% shareholding in
   OM Asset Management (“OMAM”) to HNA Capital US in a two-step transaction for gross cash
   consideration of approximately $446 million.

   Following the transaction, Old Mutual’s shareholding will reduce from 50.8% to 25.9%. The
   transaction comprises a sale of a 9.95% tranche of OMAM shares held by Old Mutual at a price of
   $15.30 per share and a sale of a further 15% held by Old Mutual at a price of $15.75 per share.

   The completion of the first tranche is subject to antitrust clearance under the Hart-Scott-Rodino (HSR)
   Act in the US and is expected to take place in approximately 30 days. Completion of the second
   tranche is subject to receipt of certain additional regulatory approvals in various other jurisdictions and
   is expected to take place in the second half of 2017.

   Old Mutual is not subject to any lock-up arrangements in respect of its remaining shareholding, other
   than its commitment to retain sufficient shares to perform its obligations with respect to this
   transaction. Consistent with its previous statements, Old Mutual intends to continue the reduction of
   its holding in OMAM in an orderly manner.

   James Ritchie, Chairman of OMAM’s Board of Directors, said: “We are pleased to welcome HNA
   Capital US as a new, supportive investor in OMAM. We remain focused on executing our growth
   strategy, which includes working collaboratively with our high quality Affiliates to diversify their
   businesses and expand their global distribution opportunities, as well as acquiring new Affiliates, to
   generate strong, long-term value for all of our shareholders. We look forward to working with HNA
   Capital US to accelerate our growth strategy for the benefit of our clients, Affiliates and shareholders.”

   Bruce Hemphill, Group Chief Executive of Old Mutual, said: “We are very pleased to announce this
   transaction which brings forward further realisation of value for Old Mutual. It represents another step
   in delivering our managed separation strategy and secures a strategic long-term investor for OMAM”.

   Guang Yang, Chief Executive of HNA Capital US, said: “OMAM is a diversified, at-scale multi-
   boutique asset management franchise with an attractive portfolio of high quality investment
   managers. We are pleased with our investment in OMAM and look forward to supporting OMAM’s
   continued growth.”

   It is expected that one HNA Capital US-nominated director will join the OMAM board on the
   completion of the first tranche and a second on the completion of the second tranche. In both cases,
   these directors will replace existing nominees of Old Mutual.

       OMAM is a global, multi-boutique asset management company with approximately $240 billion of
       assets under management as at 31 December 2016. Its diverse Affiliates offer leading, alpha
       generating investment products to investors around the world. OMAM recorded US GAAP earnings
       for 2016 of $126.4 million and Economic Net Income of $145.1 million. As at 31 December 2016,
       OMAM had total assets of $1,294 million.

       Old Mutual will use the proceeds from the transaction for general corporate purposes.
       Bank of America Merrill Lynch and Evercore acted as joint financial advisors and Skadden Arps and
       Linklaters as legal advisors to Old Mutual in connection with the transaction.

       Ends


       Enquiries
       External communications
       Patrick Bowes                        UK       +44 20 7002 7440
       Investor relations
       Dominic Lagan                        UK       +44 20 7002 7190
       Sizwe Ndlovu                         SA       +27 11 217 1163

       Media
       William Baldwin-Charles                       +44 20 7002 7133
                                                     +44 7834 524833


       Notes to Editors

       Prior to publication, the information contained within this announcement was deemed to
       constitute inside information under the Market Abuse Regulation (EU) No 596/2014

       About Old Mutual plc

       Old Mutual has announced a strategy of managed separation, which will entail separating its four businesses into
       standalone entities. The four businesses are:

       Old Mutual Emerging Markets: an attractive business with a dominant position in South Africa, well-placed to
       capitalise on sub-Saharan African growth as a diversified financial services provider with strong operations in key
       East and West African markets.

       Nedbank: one of South Africa’s four largest banks with very strong corporate, commercial and property finance
       franchises, and a growth opportunity in the retail market, as well as pan-African optionality through its stake in
       Ecobank Transnational Inc (ETI).

       Old Mutual Wealth: a leading, integrated wealth management business, focused on the UK upper and middle
       market, with strong prospects in a rapidly growing £3 trillion market.

       OM Asset Management: an institutionally focussed, multi-boutique asset management business, delivering
       strong, diversified growth in attractive asset classes through organic initiatives and acquisitions.

       For the year ended 31 December 2016, Old Mutual reported an adjusted operating profit before tax of £1.7 billion
       and had £395 billion of funds under management. For further information on Old Mutual plc and the underlying
       businesses, please visit the corporate website at www.oldmutualplc.com

       About HNA Capital US

       HNA Capital US is the New York-based subsidiary of HNA Capital, the financial services unit of HNA Group, a
       Fortune Global 500 company focused on tourism, logistics and financial services. A full-service financial solutions
       provider, HNA Capital includes a diverse set of global businesses in equipment leasing, asset management,
       insurance, investment banking, securities and credit services. HNA Group is a global company with
       approximately $145 billion of assets, more than $46 billion in annual revenues and an international workforce of
       nearly 410,000 employees, primarily across North America, Europe and Asia.

       For more information, please visit www.hnagroup.com.

       Sponsor:
       Merrill Lynch South Africa (Pty) Ltd

       Joint Sponsor:
       Nedbank Corporate and Investment Banking


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