TIDMBPM
RNS Number : 2746T
B.P. Marsh & Partners PLC
04 January 2017
Date: 4 January 2017
On behalf of: B.P. Marsh & Partners Plc ("B.P. Marsh" and the "Company")
For immediate release
B.P. Marsh & Partners Plc
Disposal of Investment in Besso
21 year investment in Besso culminates in exit
B.P. Marsh & Partners Plc (AIM: BPM), the specialist venture
capital investor in early stage financial services businesses,
announces that it has reached agreement to sell its entire 37.94%
shareholding in Besso Insurance Group Limited ("Besso") for
cash.
BGC Partners Inc. ("BGC") has agreed to acquire 100% of Besso,
with ongoing management and employees rolling over a proportion of
their existing Besso shareholdings into BGC shares. The transaction
places an entire enterprise valuation of Besso at GBP70.5m, however
the final purchase price will be subject to various adjustments by
reference to completion accounts, which the Company currently
anticipates to be as at 31(st) March 2017.
In order to put this into context, the same adjustments applied
to Besso's 31(st) August 2016 Balance Sheet would result in
estimated proceeds to B.P. Marsh of GBP20.6m net of transaction
costs and pre-tax. This equity stake was most recently valued by
B.P. Marsh at GBP20.1m as at 31(st) July 2016. Completion of the
transaction will be subject, inter alia, to FCA approval being
granted and as part of the terms of the transaction Daniel Topping,
the Company's Chief Investment Officer, will resign as a
Non-Executive Director on the Boards of Besso and Besso ESOP
Trustee Limited.
Besso commenced a strategic review in August 2015, engaging
Canaccord Genuity to assess its strategic options. During this time
B.P. Marsh has seen its valuation of Besso increase significantly
and the Company's gross proceeds from this sale will represent an
increase of c. 48% on its published valuation of the same stake in
Besso at 31(st) July 2015 of GBP13.9m.
In the year to 31(st) December 2015, Besso achieved Revenues of
GBP37.6m (an increase of 16% on 2014) and EBITDA of GBP4.17m (an
increase of 15% on 2014), and it is continuing this trend in 2016,
where it is on track to achieve EBITDA in excess of GBP10m.
In addition to the sale proceeds, B.P. Marsh's existing
shareholder loans of c. GBP1.36m will be repaid in full upon
completion. In the 2017/18 financial year the Company was
forecasting an overall income yield of 0.64% on its Besso stake,
and the Board is confident that this will be easily replaced and
exceeded as a result of reinvestment of the proceeds of this
sale.
Consequently, following completion of the transaction and
subject to adjustments at completion, B.P. Marsh expects to have
additional funds available of approximately GBP18.37m (after
transaction costs and tax). All of the above calculations are based
on the August balance sheet, and therefore are subject to change.
The Board of B.P. Marsh intends to continue to strike a balance
between utilising funds for investment for long-term capital
growth, whilst providing shareholders with a meaningful ongoing
return.
Investment funds will be targeted to both the existing portfolio
to enable those businesses to develop further and to pursue new
opportunities. The current pipeline of new opportunities includes
start-up and early stage, as well as more developed, businesses
particularly within the insurance intermediary sector both in the
UK and internationally. B.P. Marsh has expanded geographically in
recent years and now holds investments in Australia, South Africa
and Singapore as well as throughout the UK. The international
strategy remains the same; to focus on territories with good
opportunity for business development in partnership with a London
investor and a suitably developed regulatory and compliance
environment.
B.P. Marsh's investment and exit from Besso demonstrates the
success of its strategy of investing for the long-term and working
with management teams to achieve a mutually desirable exit at the
optimum time. B.P. Marsh was instrumental in establishing Besso in
1995, funding a buy out from what is now the Jardine Lloyd Thompson
Group, with an initial equity investment of GBP0.46m and further
equity investment (net of redemptions) of GBP2.37m over the
subsequent 21 years. Since the initial investment, B.P. Marsh has
supported Besso's growth through a longstanding partnership and
provision of working capital finance, including spearheading the
buy-out of Wells Fargo in 2011 and international expansion with the
opening of offices in Turkey and Brazil. B.P. Marsh will continue
its joint venture alongside Besso with its investment in Sterling
Insurance (PTY) Limited which will be unaffected by this
transaction.
Commenting, Brian Marsh OBE, B.P. Marsh's Executive Chairman,
said:
"Our investment in Besso typifies our approach - long-term,
collaborative and focused on delivering highly attractive results
for all stakeholders. We have stuck with Besso through many ups and
downs over the course of two decades, as we believe our investments
to be a true partnership with the management team or individual we
back. However, our partners at Besso have now reached the stage in
the development of their group for which they need financial
firepower which outstrips the resources that B.P. Marsh is able to
supply. Consequently, we are pleased that Besso has identified BGC
as its future ongoing partner and we wish them well."
The information contained within this announcement is deemed to
constitute inside information as stipulated under the Market Abuse
Regulations (EU) No. 596/2014.
For further information:
B.P. Marsh & Partners Plc www.bpmarsh.co.uk
Brian Marsh OBE +44 (0)20 7233 3112
Nominated Adviser & Broker
Panmure Gordon
Atholl Tweedie / Adam James / Charles Leigh-Pemberton +44 (0)20 7886 2500
Financial PR
Redleaf Communications bpmarsh@redleafpr.com
Emma Kane / David Ison +44 (0)20 7382 4732
Notes to Editors:
About B.P. Marsh & Partners Plc
B.P. Marsh's current portfolio contains twelve companies. More
detailed descriptions of the portfolio can be found at
www.bpmarsh.co.uk.
Since formation over 25 years ago, the Company has assembled a
management team with considerable experience both in the financial
services sector and in managing private equity investments. Many of
the directors have worked with each other in previous roles, and
all have worked with each other for at least five years.
Prior to Brian Marsh's involvement in the Company, he spent many
years in insurance broking and underwriting in Lloyd's as well as
the London and overseas market. He has over 30 years' experience in
building, buying and selling financial services businesses,
particularly in the insurance sector.
Alice Foulk joined B.P. Marsh in September 2011 having started
her career at a leading Life Assurance company. In 2014 she took
over as Executive Assistant to the Chairman, running the Chairman's
Office and established herself as a central part of the management
team.
In February 2015 she was appointed as a Director of B.P. Marsh
and a member of the Investment Committee. In January 2016 Alice was
appointed Managing Director of B.P. Marsh.
In her position as Managing Director, Alice is responsible for
the overall performance of the Company and monitoring the Company's
overall progress towards achieving the objectives and goals of the
Company, as set by the Board.
Dan Topping is the Chief Investment Officer of B.P. Marsh,
having been appointed as a Director in 2011. He joined the Company
in February 2007, following two years at an independent London
accountancy practice. Dan is the Senior Executive with overall
responsibility for the portfolio and investment strategy of B.P.
Marsh.
Dan graduated from the University of Durham in 2005 and is a
member of the Securities and Investment Institute and the Institute
of Chartered Secretaries and Administrators.
Dan is a standing member of the B.P. Marsh Investment and
Valuation Committees and currently serves as a Board Director
across the portfolio.
Camilla Kenyon was appointed as Head of Investor Relations at
B.P. Marsh in February 2009, having four years' prior experience
with the Company. She was appointed to the main board in 2011.
Camilla is Chair of the New Business Committee evaluating new
investment opportunities. She has a number of nominee directorships
over two investee companies and is a standing member of the
Investment Committee. She is a Member of the Investor Relations
Society.
Jonathan Newman is a Chartered Management Accountant and is the
Group Director of Finance and has over 20 years' experience in the
financial services industry. Jon graduated from the University of
Sheffield with an honours degree in Business Studies and joined the
Group in November 1999, following two years at Euler Trade
Indemnity and two years at a Chartered Accountants. Jon is a Member
of the Chartered Global Management Accountants, the Chartered
Management Accountants and the Chartered Institute of Securities
and Investment.
Jon was appointed a Director of B.P. Marsh & Company Limited
in September 2001, and Group Finance Director in December 2003 and
was instrumental in the admission of the Group to AIM in February
2006. Jon is a member of the B.P. Marsh Investment and Valuation
Committees and currently serves as a Board Director for Walsingham
Motor Insurance Limited, and provides senior financial support and
advice to all companies within the Group's portfolio as well as
evaluating new investment opportunities.
- Ends -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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