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JOHANNESBURG - Old Mutual Limited (JSE:OMU) announced Friday it will repurchase approximately 220 million ordinary shares or up to R3 billion worth of its stock, following shareholder approval granted at its Annual General Meeting on May 30.
The financial services group said the share buyback program will commence on October 3 and continue until the authorized limit is reached or as long as the program remains value accretive to shareholders.
The repurchases will take place exclusively on the Johannesburg Stock Exchange and will be implemented in accordance with JSE Listing Requirements. The company has received necessary regulatory approval from the Prudential Authority for the program.
Old Mutual’s board and management believe the company is trading at a discount to its intrinsic value and that the repurchase program will deliver longer-term incremental value to shareholders, according to the press release statement.
The primary purpose of the repurchase program is to reduce Old Mutual’s issued ordinary share capital. All repurchased shares will be cancelled and will revert to authorized but unissued ordinary share capital.
The repurchase falls under the General Repurchase Authority that allows Old Mutual to buy back up to 10% of its issued ordinary shares.
Old Mutual is a financial services group with operations across 12 countries in Africa and a niche business in China. The company is listed on the Johannesburg Stock Exchange, London Stock Exchange, Namibian Stock Exchange, Malawi Stock Exchange, and Zimbabwe Stock Exchange.
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