Ninety One recovers after 40 percent plunge on JSE debut day
Hendrik du Toit: 'We are confident in the resilience of our capital-light business model'.
Ninety One finished nearly three percent higher during Wednesday’s close on the Johannesburg Stock Exchange (JSE), with the investment firm having a better day after a bloodbath on global financial markets due to the coronavirus pandemic.
Ninety One, Investec’s newly created asset management arm, debuted with a more than 40 percent plunge in shares on Monday and started its journey as an independent business.
Shares in Ninety One, which gets its name from the year it was founded, were 22.6 percent lower than the bottom end of its target range in London, where it has a primary listing.
However, the company’s shares on the JSE were 2.76 percent higher on Wednesday to R32,00.
Ninety One, which manages £121 billion in assets, enters an equity market that has suffered historic losses in recent weeks as investors dump shares, currencies and commodities on concerns that the rapidly spreading coronavirus pandemic, which has walled off big players in the global economy, will trigger a long and steep downturn.
Ninety One has changed its name from Investec Asset Management.
The listing comes after the Investec Group’s strategic review in 2018, after which the company decided to proceed with the demerger of the Asset Management business from the specialist banking and wealth & investment business.
Ninety One is a founder-led independent global asset manager that primarily offers a range of high-conviction, active strategies to its sophisticated global client base.
Ninety One’s investment proposition for clients centres on its range of differentiated strategies managed by its specialist investment teams, providing access to a diverse range of asset classes and regions globally.
The demerger focuses the Investec and Ninety One Group’s on their respective growth paths, which enhance the long-term prospects and potential of both businesses for the benefit of their shareholders, clients and employees.
Hendrik du Toit (pictured), founder and CEO of Ninety One, commented: “Despite extraordinary market volatility we are confident in the resilience of our capital-light business model and its organically developed, specialist, active investment offerings. Ours is a long-term story of a unique business with a carefully-developed culture, a commitment to employee ownership and a long track record.”
The business will be listing on the financial services sector which currently has a market capitalisation of R384 billion.
Investec ordinary shareholders will keep their shares in Investec and will be allocated one Ninety One Plc share for every two Investec Plc shares in the name of the shareholder. The Investec ordinary shareholders will keep their Investec shares and will be allocated one Ninety One share for every two Investec shares in the name of the shareholder. Therefore, shareholders will own shares in two listed companies. Investec will hold approximately 25 percent of the combined total issued share capital of Ninety One.