Shares in insurance giant Old Mutual - which manages around £320 billion of assets globally - are going crazy on Monday morning, after rumours that the company plans to break itself up into several separate units.
News of the potential break-up was first reported by Sky News late on Friday afternoon, so shares are getting their first substantial chance to react to those rumours on Monday morning.
At the open, Old Mutual's listed on the FTSE 100, was up by as much as 11% as investors reacted to the potential split. It has since pared some of those gains, but around three quarters of an hour after the open at 8:45 a.m. GMT (3:45 a.m. ET) shares are still up more than 8%. Here's how that looks:
Investing.com
Currently Old Mutual - which was founded in South Africa, but is now headquartered in London - is a single business, but under the rumoured plans it would split into several individual businesses. They include:
- Nedbank, one of the biggest lenders in South Africa, in which Old Mutual has a big stake.
- A UK-focused wealth unit.
- A South Africa-based emerging markets operation.
- An institutional asset management business.
It is also rumoured that big buyout firms Cinven and Warburg Pincus have already tabled a bid worth several billion pounds for Old Mutual's wealth arm. The division includes investment manager Quilter Cheviot and its funds business, which is home to renowned stock picker Richard Buxton.
Responding to the rumours on Monday morning, Old Mutual said in a statement: "When our new Chief Executive Bruce Hemphill joined on 1 November 2015, we announced that we would be conducting a strategic review.
We can confirm that all options for the strategic review are being considered but no decision has yet been made."
The company reports its annual results on Friday, so any moves to split the firm could be announced then, Sky reports.