Old Mutual Holdings Plc to Sell Entire Portfolio of Properties Across East Africa

Old Mutual Holdings Plc, a regional insurer, has announced plans to sell its entire portfolio of properties across East Africa as part of its business restructuring and growth strategy. The move comes as the firm seeks to exit the struggling real estate market, which has seen weak returns and single-digit real estate yields. The sale of properties, including the iconic 31-storey Old Mutual Tower in Nairobi, will help the underwriter to restructure its business and focus on other investment opportunities. The firm's Chief Executive Officer, Arthur Oginga, has revealed that they have sales agreements for two properties in Kenya, while negotiations are underway for the sale of the Old Mutual Tower.

Key Takeaways:

• Old Mutual Holdings Plc plans to sell its entire portfolio of properties across East Africa, including the iconic 31-storey Old Mutual Tower in Nairobi.
• The sale of properties is part of the underwriter's business restructuring and growth strategy, driven by weak returns and single-digit real estate yields.
• The firm has sales agreements for two properties in Kenya, while negotiations are underway for the sale of the Old Mutual Tower.
• Old Mutual has 13 properties across East Africa, including 6 in Kenya, 4 in Uganda, 2 in South Sudan, and 1 in Rwanda.
• The firm's properties were valued at Sh19.4 billion at the end of last year, with the Upperhill office tower carrying the highest valuation at Sh5.5 billion.
• Old Mutual has struggled to make substantive returns from its property portfolio, citing a downturn in the real estate market and flat valuations over the last 10 years.
• The underwriter has also highlighted lower income from equities and higher finance costs due to the refinancing of a loan in Uganda properties.

Statistics:

• Sh19.4 billion: the total value of Old Mutual's property portfolio at the end of last year.
• Sh5.5 billion: the valuation of the Upperhill office tower, the highest valued property in the portfolio.
• Sh21.2 billion: the previously reported valuation of the property portfolio.
• 6: the number of properties owned by Old Mutual in Kenya.
• 4: the number of properties owned by Old Mutual in Uganda.
• 2: the number of properties owned by Old Mutual in South Sudan.
• 1: the number of properties owned by Old Mutual in Rwanda.
• Sh58 million: the impact of lower insurance revenues on Old Mutual's profits.
• 99 percent: the decline in Old Mutual's net earnings to Sh5 million from Sh327 million.

Sources:

• "Old Mutual plans to sell properties in Kenya, Uganda, Rwanda, and South Sudan" by Business Daily.
• "Old Mutual Holdings Plc to sell entire portfolio of properties across East Africa" by The Star.
• "Old Mutual reports near-total profit wipeout on weak interest income, fair value losses, and lower written insurance premiums" by The Nation.