Making a difference: our business in society

Developing society through investments in infrastructure

South Africa continues to face a significant challenge to rebuild the national infrastructure to meet the challenges of globalisation and therefore of increased global competition. This country also has a leading role to play in rebuilding the infrastructure of the Continent. Old Mutual plays a leading role in contributing to enhancing the infrastructure of both.

At the end of 2004 the Old Mutual Group managed R4.9 billion worth of infrastructure assets at market value (R2003: R3.2 billion; 2002: R2.0 billion). For the same period commitments and direct investments into infrastructure made by OMLACSA, amounted to R2.5 billion at market value (2003: R1.8 billion; 2002: R1.0 billion).

These investments have been particularly rewarding for investors. The Infrastructure, Developmental and Environmental Assets Fund (IDEAS), for instance, beat its inflation plus 7% target since inception (15.8% versus target of 11.9%); over three years (14.3% versus target of 12.3%); and over 12 months to date (21.2% versus target of 10.4%).

The IDEAS Fund (market value as at end December 2004, R1 billion) comprises the following investments:

In addition, Old Mutual Asset Managers, together with Macquarrie (Africa) manages the R0.9 billion South Africa Infrastructure Fund (SAIF), and the R1.3 billion African Infrastructure Investment Fund (AIIF).

Developing society through broadening the economy

Old Mutual has long championed black economic empowerment through internal policies and programmes, and through concrete actions that enable the transfer of ownership of sections of the economy into the hands of black entrepreneurs and businesses.

In 2004 Old Mutual continued to play a leading role in this regard, facilitating a number of important empowerment deals that included black investment into national companies Metcash, Pepkor, Brait and Foodcorp. Aggregated, Old Mutual in 2004 invested R275 million in unlisted companies more than 50%-owned by blacks, and R586 million in companies with between 25% and 50% black ownership.

Overall, Old Mutual had facilitated, either through direct investment in black companies or by structuring finance, empowerment deals with a market value of R1.7 billion as at end-December 2004.

Old Mutual has facilitated empowerment either through direct investments or through structured financing for, among others: