Old Mutual confirms Quilter IPO on 25 June

Old Mutual confirmed its intention to proceed with an initial public offer of up to 9.6% of the ordinary shares of Quilter next month, subject to final pricing, it announced on Tuesday.

The FTSE 100 firm’s announcement came after an update it issued on 25 May, regarding the successful passing of the shareholder resolutions at its court and shareholder meetings held in connection with the managed separation of Old Mutual.

Pricing of the global offer will be determined in due course, Old Mutual said, together with the maximum number of ordinary shares to be sold in the offer.

“The final offer price in respect of the global offer and the number of shares to be sold by Old Mutual in the global offer will be determined following publication of the price range supplement, and is currently expected to be announced on or about 25 June 2018.”

Ahead of Quilter's initial public IPO on 25 June, analysts at broker Numis attributed a valuation of £2.7bn or 143p per share, based on a sum-of-the parts valuation.

With Quilter in the process of completely rebuilding its online platform, which Numis said this presented a number of risks, especially given the company's poor track record, the supplier FNZ's poor track record and the industry's poor track record of platform delivery and implementation.

Moreover, Quilter and five other closed book life assurance peers are being investigated by the Financial Conduct Authority, principally around the appropriateness of certain charges levied on long standing customer products.

"Whilst Quilter have already voluntarily provided for some compensation, the FCA has not yet made a final decision."

A further overhang in the long term will be the inherited 55%+ Southern African investor share register, not seen as "natural owners" of a UK mid-cap wealth manager.