HARARE- South Africa based investment management company Allan Gray which has a collective funds under management of close to $40 billion largely concentrated in equities, has increased its shareholding in Old Mutual Limited.

Old Mutual Limited has a primary listing on the JSE and other secondary listings regionally including Zimbabwe. The company is one of Africa’s largest insurers and holds interests in banking, property management and asset management among others in respective markets across Sub Saharan Africa and Asia.

It operates in 14 countries in 2 continents and recently forgo its UK listings and other businesses. It also demerged Nedbank as part of a major organisational restructuring exercise. The group recently suspended its CEO Peter Moyo over allegations of conflict of interest in certain deals entered between Old Mutual and his personal company.

The ensuing battles resulted in litigations which saw the courts reversing the suspension and calling for Moyo’s reinstatement. The board has however escalated the fight with counter appeals and the case is ongoing at South African courts.

In South Africa where the company has a primary listing, the share price has come off sharply since the boardroom squabbles unravelled. It is likely that financial performance of the group may be negatively impacted if the matter is not brought to finality within the shortest possible time.

In Zimbabwe, Old Mutual has a diversified financial services offering and is a leader in insurance, property as well as equity investments. Its share price on the ZSE has realised a tremendous growth driven by hedge seekers and rent seekers capitalising on the current inflation as well as exchange rate challenges.

Government’s efforts to curtail speculation have been rebuffed by the market. In June, RBZ imposed a 90 day vesting period in fungible stocks targeting to reduce speculative gains in Old Mutual, which has been informing the spiking Old Mutual Implied Rate.

EQUITY AXIS NEWS