12th Mar 2020 15:38
(Alliance News) - Financial services firm Investec PLC will be withdrawing 10% of Ninety One's shares from the business's spin-off, Investec said on Thursday.
Investec has been planning the demerger of its asset management business since late 2018, and in November last year it said the business would be called Ninety One.
In January, Investec said it would be listing Ninety One's PLC shares on London's Main Market alongside an inward listing on the Johannesburg market. The Ltd shares will have their primary listing in South Africa.
Following the IPO, Investec was to hold a 15% stake, with 55% held by Investec PLC and Investec Ltd shareholders. Around 20% would be held by employees, and the rest by new investors.
The IPO was then priced in March between 190 pence and 235p , raising between GBP181.9 million to GBP226.1 million for Investec.
However, Investec said on Thursday it will not be offering 10% of the combined issued share capital of Ninety One due to "recent volatile market conditions". Stock markets around the world have crashed amid the continued spread of Covid-19, which has now been declared a pandemic by the World Health Organization.
Admission of Ninety One's shares will take place on March 16, Investec confirmed.
It will now hold a 25% stake in Ninety One, rather than the 15% previously envisaged.
Investec's joint Chief Executive Fani Titi said: "The completion of the demerger will mark an important milestone for Investec. It enables us to continue our drive towards simplification, focus and growth.
"Meanwhile Ninety One embarks on the next phase of its own journey. Investec shareholders will benefit from their direct ownership of these two companies and their individual potential for long-term growth and value creation."
"Market conditions have proved particularly challenging in the recent two weeks and, while we were encouraged by the strength and quality of investor engagement in relation to the global offer, we have decided to retain our shareholding in Ninety One," Titi continued.
"Importantly, the financial benefits of the demerger remain. Ninety One is an excellent company, with an exceptional management team, and we have great confidence in its prospects as an independently-listed firm."
Hendrik du Toit serves as Titi's fellow CEO.
Shares in Investec were 8.0% lower in London on Thursday afternoon at 302.80p each. In Johannesburg, they closed down 8.9% at ZAR64.09.
By George Collard; [email protected]
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