Old Mutual's Skandia acceptance level is cut

Old Mutual, the Johannesburg and London-listed financial services group, said yesterday it would push ahead with its takeover of Skandia, even if it could not win the 90 per cent shareholder support it had originally hoped for.

Announcing plans to lower the minimum level of acceptances to 50 per cent, Jim Sutcliffe, the chief executive of Old Mutual, said he would be happy to proceed with the deal even if the move did not secure a full takeover of the Swedish insurer.

While he conceded that cost synergies would not be as large if the group failed to secure the entire share capital of Skandia, he said the benefits would still be significant. Crucially, Old Mutual would have the power to elect a board of its choice and also to steer the direction of the company.

Although Mr Sutcliffe would not be pinned down on the level of shareholder support, he insisted he had the backing of a "significant majority" of investors and claimed he was still confident of getting close to 90 per cent.

He added that if the group had to settle for less than the entire share capital of Skandia, he would be in no hurry to try to acquire the remaining stake in the insurer.

Mr Sutcliffe added that since receiving the support of his company's shareholders for the deal last month, an increasing number of investment funds had begun to increase their stakes in Old Mutual.

Old Mutual is waiting for regulatory clearance from 21 different authorities who oversee the businesses of the two companies. It expects to receive this by the middle of next month, after which it will complete the Skandia deal.