Hope of a payday for private equity owners as Sabre prices £575m float

Motor insurer Sabre Insurance Group has today announced it will race onto the public markets at a value of £575m.

Sabre, which is currently owned by private equity firm BC Partners, began trading at a price of 230p and could net the firm more than three times its invested capital. When BC bought a majority stake in the company in early 2014, it was valued at around £240m.

BC has sold around half of its stake in the initial public offering (IPO), representing a return of 1.2 times its invested money. Along with the sums made from dividends already paid, this return rises to two times money – and values BC's overall investment, including the remaining stake, at north of three times.

"The board believes Sabre has the right attributes to thrive as a listed business, and capitalise on the opportunities that have been identified to deliver value to shareholders in the future," said Sabre's chairman Patrick Snowball.

Despite the fact that the float did fall slightly short of the maximum predicted market cap of £600m, it could rake in a huge cash windfall for founder Angus Ball who owns almost 20 per cent of the Dorking-based firm.

Under private equity ownership, Sabre had focused on expanding and moving from a founder-owned and -managed business to having a strong executive team.

The company focuses on underwriting what it calls "niche risks", such as young male drivers with no credit history.

It has no debt, and its 90 per cent of its shares have now gone to long-only investors.

BC has been active this year, taking on ownership of the challenger Shawbrook Bank along with a number of technology and software companies.

It has also been one of the few UK private equity houses to make continued use of the public markets for selling its companies this year, listing Altice USA in New York this summer and letting go of its final stake in Com Hem, the Swedish cable TV and broadband operator which it floated in 2014.

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