Esure’s Founder Peter Wood Makes 198 Million Pounds in IPO
Esure Group Plc founder Peter Wood made 198 million pounds ($300 million) in the insurer’s initial public offering today, three years after buying an increased stake from Lloyds Banking Group Plc.
The insurer raised 604 million pounds as it offered a 50 percent stake to investors, selling 208 million shares for 290 pence apiece, near the top of the 240 pence to 310 pence range used to canvas interest, the Reigate, England-based firm said today in a statement. Esure, which will have a market value of about 1.2 billion pounds upon listing, will get about 50 million pounds from the sale and use the money to pay down loans from Tosca Penta Investments LP.
Lloyds (LLOY), whose biggest shareholder is the U.K. government, sold a 70 per stake in Esure, which was inherited after it bought HBOS Plc in 2008, to Wood and Tosca Penta Investments LP for 185 million pounds in 2010. That stake would now be worth 840 million pounds based on the IPO valuation. The sale follows Royal Bank of Scotland Group Plc’s initial public offering of Direct Line, the U.K.’s biggest home and auto insurer, in October. Direct Line shares have since risen 8.4 percent.
Wood, 66, who founded Esure in 2000, cut his stake in the IPO to 31 percent from 49 percent. Tosca will hold about 12 percent, assuming the overallotment option isn’t exercised, the company said.
“Today’s pricing is a ringing endorsement of Esure’s strengths and future prospects,” Wood said in the statement. “As a premium listed company, Esure will have the right corporate platform for development.”
Esure is selling shares after reporting that its full-year pretax profit more than doubled to 115.5 million pounds. The insurer seeks to beat its competitors by targeting safer drivers, such as women and people over the age of 30.
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