Investec Group announced its intention to separate its money management unit, Investec Asset Management, from its wider business and subsequently list it on London Stock Exchange with a secondary listing on the Johannesburg Stock Exchange, the firm said in a statement Friday.
The move follows February management changes when John Green and Domenico Ferrini were named joint CEOs of the money management unit. Messrs. Green and Ferrini assume responsibility from Hendrik du Toit, on Oct. 1. Mr. du Toit will become joint CEO of the Investec Group and then executive chairman of Investec Asset Management after it spins out.
The transition is pending regulatory approvals and has been estimated to conclude within 12 months, a spokesman said. The changes will apply across all jurisdictions where Investec operates, he said.
Shareholders of Investec Group will retain direct equivalent stakes in the investment management unit in addition to their holding in the remaining group, following the listing. A 20% minority stake could become available to investors as the firm will consider a possibility to raise additional capital, a source close to the firm said. However, 80% of the company will be maintained by current shareholders.
"We are confident that the proposed demerger and listing of IAM provides the simplicity of structure and focus to enhance the long-term prospects of IAM and the remaining group for the benefit of our shareholders, clients and employees. We look forward to working closely as joint group CEOs during this phase of our evolution and to implement this transaction, which we expect will create significant shareholder value over time," Fani Titi and Mr. du Toit, joint CEO designates, said in a news release Friday.
J.P. Morgan Cazenove and Fenchurch Advisory Partners act as financial advisers to Investec.
Investec Asset Management has £109 billion ($141.9 billion) as of Aug. 31.