TIDMBPM
RNS Number : 4082O
B.P. Marsh & Partners PLC
08 October 2021
Date: 8 October 2021
B.P. Marsh & Partners Plc
("B.P. Marsh", "the Company" or "the Group")
Investee Company Update & Further Investment- Nexus
Underwriting Management Limited
B.P. Marsh & Partners Plc (AIM: BPM), the specialist
investor in early-stage financial services businesses, is pleased
to announce that Nexus Underwriting Management Limited ("Nexus"),
the independent specialty Managing General Agency ("MGA"), has
successfully completed a refinancing exercise which sees GBP4m of
loans repaid to B.P. Marsh over two years earlier than expected.
Simultaneously to this refinancing, B.P. Marsh has acquired a
further 2.49% shareholding in Nexus, from a founding
shareholder.
1. Refinancing
Nexus has secured a new GBP70m banking facility from Barings LLC
("Barings"), the global investment manager. This facility will be
utilised in two ways, with GBP50m being used to refinance existing
debt and meet upcoming deferred consideration payments, with the
balance available for new acquisitions.
As part of this fundraising, Nexus has repaid in full the GBP4m
Loan Facility with B.P. Marsh, alongside the GBP40m Loan Facility
with HPS Investment Partners LLC. The GBP4m Loan Facility was
originally due to be repaid by 8(th) January 2024.
When Nexus raised these facilities with HPS and B.P. Marsh in
2017, Nexus' EBITDA was GBP5m, and the equity value of its business
was GBP75m. For the 2021 financial year, Nexus is forecasting
underlying EBITDA of GBP19m and has an internal equity value of
GBP238m.
Since 2017, Nexus' underlying EBITDA has increased by 3.4x, and
the equity value by 3.1x.
This financing provides Nexus with the opportunity to make
further acquisitions and enter the next phase of its growth.
B.P. Marsh first invested in Nexus in August 2014; it has since
grown from a Gross Written Premium of GBP55m to a projected figure
of over GBP400m in 2021. Over the same period, Nexus has grown its
EBITDA by over seven times.
Barings is an international investment management firm, with
$382bn+ of Assets Under Management, over 2000 staff and offices in
16 countries.
2. Further Acquisition of Shares in Nexus
Alongside this fundraising, B.P. Marsh has acquired a further
100,000 shares in Nexus for GBP4m from Ian Whistondale, a founding
non-management shareholder.
B.P. Marsh saw this as an opportunity to allow a founding
shareholder to partially realise the value of his equity in Nexus,
whilst enabling it to acquire a further 2.49% shareholding in
Nexus.
Following this share purchase, the Group's fully diluted
shareholding in Nexus has increased to 19.18%. B.P. Marsh is now
the largest individual shareholder in Nexus, with management and
employees continuing to own over 50% of the business.
Colin Thompson, Nexus Founder and Group CEO stated:-
"This debt facility provides Nexus with the ability to satisfy
our long-term growth aspirations, increasing both Gross Written
Premium and EBITDA via organic growth and from new
acquisitions."
Dan Topping, Chief Investment Officer of the Company,
commented:-
"With this successful debt raising Nexus is well set for its
next phase of transformational growth, taking the business to
$1billion of Gross Written Premium Income, and we are looking
forward to working with them to further deliver significant equity
value uplift.
"The Group first acquired a 5% in shareholding in Nexus in 2014,
seeing this as a unique opportunity to structure a transaction
whereby we would not only be able to increase our shareholding to
our more usual percentage, but also to support and assist the
management team at Nexus to grow the business significantly. As
evidenced by their performance, management have achieved a
tremendous amount and a considerable ongoing return for the
Company."
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 / Charles Leigh-Pemberton
/ Ailsa MacMaster +44 (0)20 7886 2500
Financial PR & Investor Relations
Tavistock bpmarsh@tavistock.co.uk
Simon Hudson / Tim Pearson +44 (0)20 7920 3150
Notes to Editors:
B.P. Marsh's current portfolio contains seventeen companies.
More detailed descriptions of the portfolio can be found at
www.bpmarsh.co.uk .
Since formation over 30 years ago, the Company has assembled a
management team with considerable experience both in the financial
services sector and in managing private equity investments.
Several of the directors have worked with each other in previous
roles, and all have worked with each other for more than ten
years.
- Ends -
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