Esure to Sell New Shares Valuing Firm at as Much as $2 Billion
Esure Group Plc, the U.K. auto insurer started by Direct Line Insurance Group Plc (DLG) founder Peter Wood, said it will sell new shares that values the company at as much as 1.3 billion pounds ($2 billion).
Shareholders including Woods and Tosca Penta Investments LP will sell as many as 20.8 million shares, according to a statement from Surrey, England-based Esure. The firm will raise about 50 million pounds from an issue of new shares and the proceeds will be used to repay all its debt.
Esure’s sale follows Royal Bank of Scotland Group Plc’s successful initial public offering of Direct Line, the U.K.’s biggest home and auto insurer, in October. Direct Line shares have risen 11 percent since then.
Esure is selling shares after reporting full-year pretax profit more than doubled to 115.5 million pounds, it said last month. The general insurer seeks to beat its competitors by targeting safer drivers such as people over the age of 30 and women, who it sells to through its Sheila’s Wheels brand.
Issuers in Europe, the Middle East and Africa raised $3 billion in IPOs this year, compared with $545 million they sold in the same period in 2012, data compiled by Bloomberg show. Rabee Securities is ranked first in managing the sales, after it was the sole organizer of Asiacell Communications PJSC’s $1.3 billion initial share sale, the region’s largest this year.
Trading of Esure shares, which will have a free float of as much as 50 percent of its shares in the IPO, or 575 million pounds at a midpoint valuation, is expected to begin on March 27, the company said.
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