Dual-listed South African financial services group Investec said Friday it would demerge and publicly list its asset management business to accelerate growth.
The company also reported an increase in first-half net assets, though warned of woes in the asset management unit.
Following a strategic review, the company said that while there were compelling linkages with its specialist banking unit, there were 'limited synergies' between the businesses.
'As an independently listed company, Investec asset management would be better positioned to accelerate its growth and attract and retain investment talent,' the company said.
The Investec specialist banking and wealth & investment businesses would remain part of the group's current dual-listed companies structure.
For period from 31 March through August, Investec reported third party assets under management increased 4.0% to £167.0bn and 8.7% at neutral currency rates; customer accounts decreased 5.5% to £29.3bn; and core loans and advances decreased 5.5% to £23.7bn.
The company said revenue is expected to be moderately ahead of the prior period.
But it warned that performance of the wealth and investment business is expected to be behind the prior period, as earnings in South Africa had been impacted by lower activity levels, and higher costs from its UK operations.
The specialist banking business is expected to post results ahead of the prior period, the company said. 'The first half of the group's financial year continued to see macro challenges in its key operating geographies,' the company said.
'The South African economy entered into a technical recession with pressures on household spending and dented business confidence due to continued policy uncertainty. In the UK, Brexit related uncertainty has persisted, however the UK economy has remained resilient.' At 8:08am: (LON:INVP) Investec PLC share price was +59.3p at 544p