South Africa's Nedcor Teams Up With Old Mutual To Snap Up Fleming Offshore Banking

by Robert Lee, Tax-news.com, London

20 April 2001

Major South African banking group Nedcor announced yesterday that it was joining forces with its parent company Old Mutual PLC to acquire Fleming Offshore Banking, which operates from the Isle of Man and Jersey, from JP Morgan Chase & Co.

The acquisition, which is subject to regulatory approval in Jersey, Guernsey, the Isle of Man and South Africa, will see Old Mutual transfer its Guernsey-based fiduciary business into the new company. According to Nedcor, the enlarged private bank - to be named Gerrard Private Bank - will offer clients "a full range of offshore banking, investment and fiduciary services for the benefit of local and international high net worth clients." The name Gerrard has long been synonymous with private client wealth management and the new Gerrrard Private Bank will be no exception. It will offer, says Nedcor, "a discreet and comprehensive private banking service for wealthy clients offshore.'

Commenting on the deal, Nedcor chief executive Richard Laubscher said: 'From a Nedcor perspective, this acquisition has huge significance, not only because of what it means for the clients of Nedbank Syfrets Private Banking, but also because it marks a substantial enhancement of our international offering in partnership with Old Mutual.'

Mike Levett, Chairman and Chief Executive of Old Mutual, added: 'Our leading private client and offshore investment businesses have planned for some time now to add a private banking service to complement and complete their services for customers. I am delighted that we have been able, in partnership with Nedcor, to acquire Fleming Offshore Banking, to enable us to enhance our existing services.'

Under the terms of the acquisition, Nedcor will hold a 74 per cent equity stake in the renamed Gerrard Private Bank, with Old Mutual holding the remaining 26 per cent. Nedcor’s purchase will be financed by funds held outside South Africa, while Old Mutual will transfer the operations of Fairbairn Trust Company into Gerrard Private Bank in exchange for its stake. Old Mutual will have the option to increase its stake to 51 per cent within the next four years.

At the end of the first quarter of 2001 Fleming Offshore Banking had net assets of approximately £24 million.

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