Old Mutual Private Equity to acquire 100% stake in Long4LifeThe deal is valued at ZAR 4.2 billion and will be financed through a combination of debt and equity.14 March 2022

Old Mutual Private Equity (OMPE), a division of Old Mutual Alternative Investments (Pty) Ltd, is pleased to announce that 89.9% of Long4Life Limited’s (Long4Life) shareholders, present and voting at the shareholders’ meeting held on 28 February 2022, approved the transaction for OMPE to acquire 100% of Long4Life and delist the company.

The deal is valued at ZAR 4.2 billion and will be financed through a combination of debt and equity.

OMPE identified Long4Life as a potential delisting opportunity shortly after the Company’s announcement in April 2021 that it was undergoing a strategic review to assess options to unlock value for its shareholders.

OMPE engaged the Long4Life Board and Chairman, and eventually the shareholders, to construct an offer that was appealing to them, provided a clean exit and the value unlock that shareholders sought to achieve.

Some of the businesses in the Long4Life stable are well known to OMPE, given that they were transacted on previously in the private market. OMPE had long viewed them as high-quality businesses with steady and consistent growth, strong cash generation and high-quality management teams. This familiarity with the assets allowed OMPE to move very quickly from its first evaluation of the transaction to making a binding offer to shareholders.

The transaction is a significant one for OMPE Fund V. It presents a unique opportunity to acquire three businesses in one transaction. OMPE will delist Long4Life, unbundle the three underlying segments, being Holdsport, Chill & Inhle Beverages and the Personal Care & Wellness segment into OMPE Fund V, to be managed as separate businesses with their own management teams.

The OMPE team will partner with the management teams on an agreed vision and strategy, as well as provide capital, perspective, stewardship and ESG disciplines. We believe that the transaction will provide our investors with attractive returns.

“Our modus operandi as OMPE is to deliver deals that are a win-win solution for all parties. We always knew to successfully execute on a transaction of this magnitude, not only would it be important to deliver a value unlock for shareholders, but also speed and certainty of execution, which we believe was what made the OMPE offer very compelling to Long4Life,” said Chumani Kula, Co-Head of Old Mutual Private Equity.

“Our offer was also very compelling to underlying management, which enables the underlying teams to invest alongside us directly in their own businesses and therefore be more in control of their own destiny. Lastly, from an OMPE perspective, the deal represented an attractive opportunity to acquire high-quality assets which we like and have followed for a long time, whilst partnering with strong management teams with which we are aligned.”

“As OMPE we have been around for more than two decades and we were able to bring our extensive experience to bear in executing swiftly on a transaction that had its share of complexities, as they always do. This deal represents a significant milestone for our franchise and could be viewed as a landmark transaction in the context of South African private equity, which we are very pleased about. We wish Brian and the rest of the Long4Life team well and look forward to our partnership with the underlying management teams,” said Jacci Myburgh, Co-Head of Old Mutual Private Equity.

The deal is subject to further conditions precedent (including the approval of the Competition Commission) and is expected to be concluded in June 2022.