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Durban - Financial services group Old Mutual’s plan of selling non-core assets is gaining momentum with the news that the group might offload its Latin American operations. Old Mutual announced in November 2015 that it was going to split its businesses into four units.

On Wednesday reports emerged that the group could sell its Latin American operations to narrow the focus of its emerging-markets business to sub-Saharan Africa, according to the industry analysts who are familiar with Old Mutual business.

Ron Klipin, portfolio manager at Cratos Capital, said the move made sense as it complemented the company’s strategy of selling non-core assets.

Klipin said Old Mutual wanted to reduce its asset concentration to the continent.

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“Old Mutual will consist of SA-Africa operations, emerging markets, and the UK business, Old Mutual Wealth, after the group has completed the strategic review which is expected to be completed by the end of 2018,” Klipin said.

The Latin American units that could be spun off are the Colombian, Mexican and Uruguayan divisions. These businesses could be worth as much as $457 million (R6 billion).

In Colombia, Mexico and Uruguay, Old Mutual provides life insurance and investment and asset management services.

Old Mutual has been active recently, with stakes in some of its regions being put up for sale by the group.

Last month Old Mutual said it was exiting its Indian joint venture with Kotak Mahindra Bank by agreeing to sell its 26 percent stake for £156m (R2.64bn).

The transaction is still subject to Indian regulatory approvals and is expected to complete in the second half of 2017.

The company also said in March that it had agreed to sell a 24.95 percent shareholding in Old Mutual Asset Management (Omam) to HNA Capital in a two-step transaction for gross cash consideration of about $446m. As a result, Old Mutual’s shareholding will be reduced from 50.8 percent to 25.9 percent.

The transaction comprises a sale of a 9.95 percent tranche of Omam shares held by Old Mutual at a price of $15.30 per share and a sale of a further 15 percent held by Old Mutual at a price of $15.75 per share.