Old Mutual, the London-listed but South Africa-focused insurance and investments group, has announced that up to 800 jobs are to go following its review of recently-acquired Skandia.
Old Mutual bought Skandia in February 2006 in a bid to give its operations greater global reach in light of their current heavy reliance on the South African market. Skandia, the Swedish insurer with extensive interests across Scandinavia and in the UK, resisted the hostile bid for several months in what proved to be an acrimonious deal.
Now Old Mutual CEO Jim Sutcliffe has revealed that the firm will cut between 600 and 800 jobs as it targets cost savings of around GBP70 million per annum, although it is not clear how many jobs will go from the Skandia unit itself. Old Mutual has also revealed that it plans to retain the internet banking arm of Skandia, which it had earlier suggested it could sell.
Old Mutual says it expects Skandia’s funds under management to increase by 15% per annum, doubling in five years.
Skandia is every bit as good a business as we believed, with the potential to double in size over the next five years, says Skandia CEO Julian Roberts. Sales growth is strong and there is a talented team in place keen to move the business forward as we implement a series of initiatives to deliver Skandia’s fullest potential.