UPDATE 3-Old Mutual CEO says suspension not linked to wrongdoing

1 BUSINESS

Business News - Opportunities - Reviews

 

 

* Shares in S.Africa’s No.2 insurer fall 5 pct

* Suspension follows “breakdown in trust”

* Suspended CEO says relates to investment firm he founded

* Says no wrongdoing on his part (Recasts with Moyo interview, updates shares)

By Emma Rumney

JOHANNESBURG, May 24 (Reuters) – Old Mutual Chief Executive Peter Moyo has been suspended after a disagreement over how the company should engage with an investment firm he founded, Moyo told Reuters, knocking shares in South Africa’s No.2 insurer.

Old Mutual said on Friday that it had suspended Moyo with immediate effect due to a “material breakdown in trust” but did not elaborate.

Chief Operating Officer Iain Williamson has taken over as acting CEO, it said.

Moyo, who took the helm at newly-listed Old Mutual Ltd less than a year ago, told Reuters by phone that his suspension related to how different parties thought Old Mutual should engage with NMT Capital, which he founded and in which an Old Mutual subsidiary is an investor.

“That relationship has always been there from the day I started and it was properly disclosed,” he told Reuters by phone, emphasising the suspension was the result of differences on the approach to engagement rather than the relationship itself.

“There is actually absolutely no wrongdoing on my part,” he said.

An Old Mutual spokeswoman did not respond to Reuters requests for immediate comment on how the relationship between NMT Capital and Old Mutual Life Assurance Company, the subsidiary, was related to Moyo’s suspension.

The insurer had said in a statement earlier that various engagements between Moyo and the board, headed by businessman and former finance minister Trevor Manuel, had resulted in a “material breakdown in trust and confidence” between the two sides.

Moyo rejoined Old Mutual in 2017, initially as head of its emerging markets division, before the former conglomerate’s main African financial services business was split off in a disentanglement of the 173-year-old group’s structure.

Chairman Trevor Manuel, a businessman and former South African finance minister, would provide more information at the Old Mutual’s annual general meeting, a spokeswoman said.

Both Old Mutual’s Johannesburg and London-listed shares fell 5% on news of Moyo’s suspension. It was trading at 21.17 rand per share at 1104 GMT in Johannesburg, down 2.44% decline.

Since its listing as a separate business in June 2018, Old Mutual has worked to hone its strategy as a stand-alone business and parent company to what remains of Old Mutual Plc.

Old Mutual announced a 2 billion rand ($139 million) share buyback in March in a bid to placate shareholders following an almost one-third drop in the share price after its listing.

$1 = 14.4076 rand
Reporting by Emma Rumney; editing by Rashmi Aich, Jason Neely
and Alexander Smith

1 BUSINESS

Business News - Opportunities - Reviews

 

 

Leave a Reply