One of Britain’s best-known private equity firms plans to float on the stock market in a deal that will value it at £2billion.
In a rare move for the usually secretive industry, Bridgepoint wants to go public by listing shares in London as soon as next month.
The deal will see it raise £300million through the sale of new shares while the current owners – including 140 partners – will share a £200million windfall as they trim their stake.
In a rare move for the usually secretive private equity industry, Bridgepoint wants to go public by listing shares in London as soon as next month
But the listing will also force Bridgepoint, which owns firms from Hobbycraft to Miller Homes as well as the UK and French franchises of Burger King, to open up to investor scrutiny.
And it will give retail investors the chance to buy shares in the firm.
The move comes amid record levels of private equity deal-making in the UK, with firms including Morrisons, G4S and McCarthy & Stone among those targeted by the buy-out giants.
Critics have accused the industry of ‘pandemic plundering’ as predators seek to exploit a slump in share prices during the coronavirus crisis by taking over firms on the cheap.
The worst excesses of private equity – including debt-fuelled acquisitions, job losses and asset stripping – have been highlighted by this newspaper, which is calling for change and pushing bosses to be more open and responsible.
The listing will also force Bridgepoint, which owns firms including Hobbycraft and the Itsu restaurant chain to open up to investor scrutiny
Bridgepoint executive chairman William Jackson is understood to be keen to draw a distinction between his business and those at the sharper end of the market.
‘This will herald a new period of openness for the industry,’ a source close to Bridgepoint claimed.
The firm has invested in some of the High Street’s best-known names – it bought cafe chain Pret A Manger in 2008 before selling it a decade later, by which point it had grown staff numbers from 4,000 to more than 10,000.
It is now trying to replicate that success at Itsu, the Japanese fast-food chain it backed this year.
When Bridgepoint invested in Itsu last month, it vowed to open 100 outlets in the next five years, creating 2,000 jobs.
The firm also counts retail veteran Archie Norman, the chairman of Marks & Spencer, as its senior independent director.
Amid pressure on private equity to open up, Bridgepoint’s listing will be a step in the right direction as the company will be forced to answer to its public shareholders.
Currently, the firm gets its money from major institutions, such as sovereign wealth funds and pension funds, but anyone will be able to buy shares when Bridgepoint lists on the stock market.
Bridgepoint executive chairman William Jackson is understood to be keen to draw a distinction between his business and those at the sharper end of the market
When this happens, it will have to reveal the pay of its directors, who can often rake in millions of pounds every year.
And it will be pushed into revealing more details about its own performance and that of the companies it buys.
The only other major private equity firms listed in London are 3i and Intermediate Capital Group.
But titans in the US such as Apollo Global, Blackstone and Carlyle Group have seen share prices hit record highs in recent weeks as investors pile money in.
Bridgepoint’s initial public offering will make millions for its 140 already-wealthy partners, who own 80 per cent of the company between them and will be cashing in around a fifth of the stakes that they hold.
Together with Dyal Capital, an investment firm which owns the remaining 20 per cent of Bridgepoint and also plans to sell down, they will bag £200million.
