January 26, 2004
By Vera von Lieres
Cape Town - In another step towards streamlining PSG Investment Services, financial services parent PSG would divide the operations of its 95 percent held subsidiary into three autonomous business units, PSG chairman Jannie Mouton confirmed on Friday.
The move, from the beginning of March, forms part of the financial services group's new business guise, which is characterised by a far smaller capital base than in previous years.
PSG has over the past year and beyond realigned following the acquisition by Absa of PSG Investment Bank, the specialist investment bank that was a core contributor to group profit.
In addition, the group more than a year ago acquired financial services and fund management operation Appleton and unbundled its 55 percent interest in mass market-focused retail bank Capitec Bank.
Mouton said PSG Investment Services would in future consist of PSG Fund Management, stockbroking operation PSG Konsult and PSG Online. "Following the Appleton takeover, we have now decided to give the businesses their own identity."
PSG also has a 25 percent stake in m Cubed, which is trading under cautionary pending shareholder approval to sell its multimanagement operations to Momentum for R175 million.
Momentum has offered to acquire m Cubed Asset Management, Escher Structured Products, Corporate Money Managers and Asset Management Outsourcing Services for cash.
In its half-year numbers to August, PSG said it would pay another special dividend early in its next financial year in an attempt to unlock value for shareholders - following closely on a special distribution of R2 a share early last year.
Interim numbers were not strictly comparable because of the acquisition by Absa of PSG Investment Bank and the special dividend paid out in March.
Despite a substantially reduced capital base following the exit of the investment bank from the group, PSG generated a positive cash flow and had no external debt.
PSG Group shares rose 0.5c to close at R3.55 on the JSE Securities Exchange on Friday.
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