| Fri 3 Oct 2008, 8:00 | | OML - Old Mutual Plc - Arbitration Ruling |
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OML
OLOML
OML - Old Mutual Plc - Arbitration Ruling
Old Mutual Plc
ISIN CODE: GB0007389926
JSE SHARE CODE: OML
NSX SHARE CODE: OLM
ISSUER CODE: OLOML
Arbitration Ruling
Old Mutual plc ("Old Mutual" or the "Group") announces that a ruling has been
passed in respect of the arbitration proceedings between Skandia AB ("Skandia"),
the Group`s Swedish subsidiary and Skandia Liv, Skandia`s wholly owned life
insurance company in Sweden which is run on a mutual basis.
In 2002, prior to Skandia being acquired by Old Mutual, it sold its asset
management business, Skandia Asset Management, which principally managed the
assets of the Skandia Liv business, to Den Norske Bank for SEK3.2 billion. As
previously disclosed, following the sale, Skandia Liv submitted a claim against
Skandia, firstly based upon the proceeds of sale and, secondly based upon the
terms of the asset management agreement entered into prior to the sale. In June
2004, Skandia and Skandia Liv agreed to settle the dispute by means of a binding
arbitration process.
The arbitration board has not accepted Skandia Liv`s claim to any part of the
purchase price paid, but has ruled that Skandia is obliged to pay Skandia Liv a
total sum of GBP47 million (SEK580 million) plus interest by way of compensation
in relation to fees under the asset management agreement which Skandia Liv
deemed to be higher than prevailing market rates. Old Mutual had already set
aside GBP41 million (SEK500 million) to cover the arbitration within its pre-
acquisition balance sheet.
Julian Roberts, Chief Executive of Old Mutual, commented:
"We are pleased with the outcome of the ruling. We can now put this behind us
and continue to focus on achieving our strategic aims for the Swedish business."
For further information on Old Mutual plc and to view a translation of the
executive summary of the arbitration ruling, please visit the corporate website
at www.oldmutual.com
Enquiries
Investor
Relations
Aleida White UK +44 (0)20 7002
7287
Deward Serfontein SA +27 (0)82 810
5672
Media
Matthew UK / SA +44 (0)20 7002
Gregorowski 7133
Finsbury
Mike Smith / UK +44 (0)20 7251
Brian Cattell 3801
Notes to Editors
Old Mutual
Old Mutual plc is an international savings and wealth management company
based in the UK. Originating in South Africa in 1845, the group has a
portfolio of businesses offering asset management, life assurance, banking
and general insurance services in over 40 countries in Europe, the Americas,
Africa and Asia-Pacific. Old Mutual plc is listed on the London Stock
Exchange and the JSE, among others.
In the year ended 31 December 2007, the group reported adjusted operating profit
of GBP1.62 billion (on an IFRS basis) and had GBP279 billion of funds under
management at the year end. The Company has approximately 53,000 employees.
Skandia Nordic
Skandia has operated in the Swedish market for over 150 years. Its Swedish
business, Skandia AB, offers a full set of financial products to individuals and
life insurance products to corporations. Skandia and Skandia Liv, its mutual
subsidiary, hold a leading position in the local life assurance, with a combined
customer base of 1.9 million customers in their Nordic operations.
Skandia Liv
Skandia Liv is Sweden`s largest life assurance company offering life and
pensions insurance in the traditional life market with assets under management
as at 31 December 2007 of SEK 303 billion. The company is a wholly-owned
subsidiary of Skandia, but operates as a mutual company within a strict local
legal framework that does not provide its holding company with power to control
it in such a way as to access benefits usually associated with share ownership.
Instead the benefits accrue to Skandia Liv`s policyholders.
Ref 146/08
3 October 2008
Sponsor
Merrill Lynch South Africa (Pty) Limited
Date: 03/10/2008 08:00:02 Produced by the JSE SENS Department.
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