LONDON (ShareCast) - (Sharecast News) - Quilter said on Thursday that it is mulling the sale of its Old Mutual Wealth Life Assurance business as it announced a strategic review of the unit.
The wealth manager said no decision has been taken by the board on any particular option, including whether to dispose of Old Mutual Wealth Life Assurance.

"Accordingly, there can be no certainty that any transaction will be concluded, or if so, its timing or terms," it said, adding that a further announcement will be made if and when appropriate.

At 1005 BST, the shares were up 0.7% at 146.19p.

RBC Capital Markets said: "We see this more formal announcement as effectively in-line with the spirit of the message management has consistently given on QLA since the time of the IPO last year (i.e. that the business is seen as non-core).

"We continue to see any deal at a sensible price as positive for QLT shareholders, not least due to the implications on the Quilter balance sheet. A sale may present the opportunity for QLT to exit Solvency II, or materially reduce its working SII ratio (QLT currently operates at 190% whilst wealth manager peer St. James's Place last reported was 143%)."

UBS said: "We believe that this business is not core to Quilter's strategy and that a sale of this business would improve the investor appetite for the stock as this would create a more focussed vertically integrated wealth management business. With this business closed (i.e. in run-off) we believe that, if sold, the growth profile of the group could be materially enhanced.

"As Quilter stated that they have no need for additional capital currently, we believe the strategic review may increase prospect of potential proceeds to be returned to shareholders via a special dividend."

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