World leading animal insurance business –
Sold for 40 times earnings
This privately held entrepreneurial company was
considering an IPO as the owners wanted to realise
cash and remain in charge. It became apparent
however that significantly higher value would
be achieved through a trade sale.
Work was undertaken to build a comprehensive
financial model which looked back two years and
looked forward two years. In addition to providing
potential buyers with the detailed financial data
they needed for due diligence, it “condensed”
the key drivers of the business, allowing the
most senior decision makers at potential buyers
to get their head around the business quickly.
An Information Memorandum was produced together
with an executive summary thereof. This was prepared
like a mini-prospectus thus serving the purpose
of both trade sale and pathfinder prospectus should
the IPO market suddenly become a better alternative
for the shareholders. Additionally, a fully indexed
dataroom was prepared.
The company attracted a number of buyers, but
Cornhill Insurance were the successful bidder,
paying £32m (40 x earnings).
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