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Old Mutual divests from Moyo’s NMT Capital

OLD Mutual Limited (OML) has revealed plans to divest from NMT Capital, a company founded by its recently axed chief executive, Peter Moyo.


OLD Mutual Limited (OML) has revealed plans to divest from NMT Capital, a company founded by its recently axed chief executive, Peter Moyo.

Last month, the South African-based financial services giant fired Moyo for the second time despite a ruling by the Gauteng High Court in Johannesburg, calling for his reinstatement. This was after Moyo took OML to the court over his initial expulsion in June.

The fallout began when OML got its Old Mutual Related Party Transaction Committee (RPTC), a committee of independent OML board members, to investigate Moyo’s related transactions in NMT and found conflict of interest. This was due to OML, through its subsidiary Old Mutual Life Assurance Company South Africa (OMLACSA), being the only institutional investor in NMT.

“There was no change in the quantum or nature of the shareholding in NMT Capital or NMT group during the period (half year ended June 30, 2019), however, the board has communicated its intentions to NMT and is in the process of exiting this investment,” said OML in the group’s interim half year results ended June 2019, released yesterday.

“Subsequent to the period end the group received R47 million in cash from NMT Capital, reflecting the full repayment of the outstanding preference shareholding in NMT Capital at that date. The investments in the NMT companies have been valued based on a directors valuation.

“The negotiations to exit the remaining investments are in early stages and the timing and mechanism of the realisation is yet to be determined. The valuation of this investment will continue to be monitored as negotiations progress.”

According to OML, Moyo is a non-executive director of NMT Capital Proprietary Limited (NMT Capital) and NMT Group Proprietary Limited (NMT Group), and holds an equity interest in both companies.

“OMLACSA has provided equity and preference share funding to both NMT Capital and NMT Group as well as related entities. RZT Zeply 4971 Proprietary Limited, RZT Zeply 4973 Proprietary Limited and STS Capital Proprietary Limited are ordinary shareholders and related parties of NMT Capital,” OML said.

OML said it was also made aware that the Industrial Development Corporation of South Africa Limited raised a dispute with the directors of NMT over the payment of the ordinary dividend in 2018, which they viewed to be unlawful.

“In light of this, the group has transferred an amount of ZAR21 million into an independently managed trust account, pending the resolution of this dispute,” OML said.