Investec to hive off asset management, shares jump

By Tiisetso Motsoeneng and Emma Rumney

JOHANNESBURG/LONDON (Reuters) - South Africa's Investec plans to hive off and separately list its asset management unit in a restructuring that comes as the long-serving company founder leaves the financial services group.

The bank plans to float the asset management business on the London Stock Exchange with a secondary float on the Johannesburg exchange. The proposed deal, the precise details of which are yet to be worked out, sent shares in Investec 11 percent higher.

"It is now the right time to demerge and list our asset management business to support it in the next phase of its development," Chief Executive Stephen Koseff said in a statement.

Koseff will leave next month almost four decades after co-founding the company.

Investec's asset management unit has 109 billion pounds ($143 billion) in clients' assets under custody, with offices in several cities such as London, Cape Town, New York and Hong Kong. It contributes around a fifth of group profits.

Under the deal, the current head of the asset management business, Hendrik du Toit, would be the chief executive of that business, while Fani Titi would become the CEO of investment banking business, or what is left of Investec.

Koseff was instrumental in transforming Investec from a small leasing outfit in Johannesburg into a global investment banker and asset manager with more $200 billion of clients' money under custody and a substantial presence in South Africa, Australia and Britain.

The Anglo-South African bank said the move will allow its asset management business to thrive as an independently-listed company, and will help it to attract top quality fund managers.

There will be discussions about whether the divested asset management business will keep the Investec branding, a senior Investec executive told reporters on Friday.

Investec said divesting the asset management business will help it focus on growing its core specialist banking and wealth management businesses.

The bank has hired J.P. Morgan Cazenove and Fenchurch Advisory Partners as financial advisors.

(Writing by Lawrence White; Editing by Mark Potter and Keith Weir)