Old Mutual Wealth ready for break-up as profits soar

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Old Mutual Wealth ready for break-up as profits soar

Old Mutual Wealth announced profits of £363m for the 2017 calendar year, an increase of 40 per cent on 2016.

The company said performance fees soared to £101m, compared with £26m in 2016, were key to the increased revenue.

Around £84m of the performance fee income came from what Old Mutual Wealth calls its single strategy business.

This is the Old Mutual Global Investors business, which the company announced in December is to be sold to its management team and a private equity firm.

Under the terms of the sale, performance fees earned by this unit in 2018 will not be retained by the Old Mutual Wealth company.

Old Mutual Wealth intends to list on the stock market this year, but, as FTAdviser previously reported, it will do so under the name Quilter.

Quilter Cheviot is a wealth management business already owned by Old Mutual Wealth. The name change is part of the company’s plan to split from its South African parent company, Old Mutual.

Paul Feeney, chief executive of Old Mutual Wealth, said: "We have attracted very high levels of net flows, our business model is proving a huge success in providing what customers want and our normalised profitability has been stable despite significant investment into the business ahead of our listing.

"We have a strong balance sheet, a strong capital and liquidity position and we are financially independent from Old Mutual PLC. We have completed our separation activities and we are ready to list as Quilter PLC.”

david.thorpe@ft.com