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Old Mutual Global Investors sold to private equity firm

Old Mutual Global Investors sold to private equity firm

Old Mutual Wealth has sold its OM Global Investors funds business to private equity giant TA Associates for a total consideration of £600 million (€679 million).

The deal is expected to be completed as soon as 1 January 2018, with £570 million (€654 million) as an upfront payment and a further £30 million payable between 2019 and 2021 ‘as surplus capital is released’.

OMGI chief executive Richard Buxton said: ‘I believe this is a good outcome for our customers and our staff.

‘The management team is delighted to be partnering with TA Associates to buy the single strategy business.’

Old Mutual Wealth is due to be spun out of its South African parent group into a standalone, FTSE 100 diversified financial service group next year.

In a mammoth, four-hour presentation last month, the company detailed why it saw the funds business as sufficiently different to justify a sale, although it will retain a multi-asset fund unti.

OMGI currently runs £25.7 billion (€29.1 billion), primarily in high-conviction equity mandates. Once the sale is completed the remaining wealth business will run £106 billion (€120 billion) in client assets.

OMW chief executive Paul Feeney added: ‘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.’

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