Old Mutual shareholders approve Old Mutual Bula Tsela empowerment deal

The deal is a major milestone in South Africa’s B-BBEE history, making Old Mutual the first insurer in South Africa to facilitate an offer of shares directly to the Black South African public, including lower income earners.

Shareholders today approved Old Mutual’s new transformative empowerment transaction, reflecting Old Mutual’s ongoing commitment to real and tangible transformation.

Aptly named Old Mutual Bula Tsela (pave the way in Sesotho), the deal will enable qualifying Black South Africans, including Old Mutual employees, to share in the success of the company.

Expected to be fully implemented by December 2022, it will see Old Mutual facilitate a share offer to Black South Africans, including those who don’t usually have access to these types of share schemes, to invest indirectly in the Old Mutual Limited share. The Group strongly believes that this scheme has the potential to transform lives and build mutually positive futures for all involved.

“We are proud to confirm that our shareholders have approved the implementation of Old Mutual Bula Tsela at a general meeting held earlier today. This deal underpins our firm belief that real transformation is necessary to sustain business growth and serve the best interests of all South Africans,” says Old Mutual Chief Executive Officer Iain Williamson.

The Old Mutual Bula Tsela Retail Scheme will be opened on 22 August 2022, with the application window closing on 24 October 2022.

Qualifying applicants can apply for a minimum of 200 Retail Scheme shares at a total subscription price of R2,000, payable upfront as a lump sum. Ten percent (10%) of the Retail part of the scheme will be set aside for applicants who cannot afford to pay the R2,000 upfront – they can apply for a maximum of 100 Retail Scheme shares at a total subscription price of R1,000, paying only R100 upfront and the remainder will be payable over a 12-month period.

Old Mutual cannot, however, guarantee that all applicants will be awarded the Retail Scheme shares that they apply for.

“Through this Old Mutual Bula Tsela Retail Scheme, we will give our people the opportunity to become (indirect) owners of the company they love and trust. Apart from the many benefits for those who invest, this scheme also ensures we can accelerate our own broad-based black economic empowerment ownership (B-BBEE) targets to exceed 30% Black ownership,” says Williamson.

“The reality is that consumers are stretched but many are looking for ways to save or invest for the medium-to-long-term. It’s very important for South Africans to understand that they can invest small amounts consistently to create savings for themselves – one does not need hundreds of thousands of rands to start your savings journey,” Williamson adds.

This transaction follows the more than R7.9 billion of value created when Old Mutual’s 2005 B-BBEE deal matured in 2015. It also builds on the immense successes Old Mutual is achieving in driving broad-based transformation through initiatives such as:

• The Imfundo Trust, Old Mutual Investment Group’s scholarship initiative that aims to provide funding for students with a particular interest in the investments industry thereby supporting its transformation.
• Customised funding solutions to black-owned small businesses, either for asset finance, working capital or both through the Group’s Masisizane Fund.
• The successful conclusion of the sale of a 21% stake in Futuregrowth Asset Management to African Women Chartered Accountants (AWCA) Investment Holdings to increase the pool of Black women-chartered accountants in South Africa while growing Black ownership in the financial services sector.

“On 26 June 2018, we came back home and are now firmly anchored in the continent we love, driving her growth and developing innovative solutions for her people. Since moving our primary listing, we have acted fast to re-align and cement our business objectives, having developed a strategic framework to ensure we are our customers’ most trusted lifetime partner,” says Williamson.

“Transformation is a key component of our strategy and journey as a trusted partner in Africa. We want to keep playing a significant role in driving growth and transformation broadly. Now, we’re inviting our key stakeholders to join us as we work to ‘open the way’ and make a real, sustainable difference to their lives and livelihoods through this share scheme,” concludes Williamson.

Full details will be provided in a detailed prospectus, which will be released on our website at https://www.oldmutual.com/bula-tsela/ on 22 August 2022, including steps to take to apply.