Further Investment in Insurance Broker

RNS Number : 0825E

B.P. Marsh & Partners PLC

01 April 2011

 



B.P. Marsh & Partners Plc ("the Company")

Investment in Insurance Broker

B.P. Marsh & Partners Plc (AIM:  BPM), a niche venture capital provider to early stage financial services businesses, today announces that its wholly owned subsidiary, B. P. Marsh & Company Limited ("BP Marsh"), has acquired an 11% equity stake in Besso Holdings Limited ("Besso") from Union Hamilton Reinsurance Limited ("Union Hamilton") for a cash consideration of £735,000. Further consideration of up to £300,000 may be payable by B. P. Marsh, in the event that 50% or more of the voting shares in Besso are acquired within 18 months, at a higher price per share. The acquisition was made alongside two other parties, namely, Brian Marsh Enterprises Limited and Mr. Michael Wade who acquired the remaining 26.3% stake from Union Hamilton for an aggregate consideration of £1,715,000. These acquiring parties are also subject to the same anti-embarrassment provisions as described above.  

As a result of this transaction, B. P. Marsh's equity interest in Besso has increased from 22.7% to 34.0% and Brian Marsh Enterprises Limited and Mr. Michael Wade hold 11.3% and 15.0% respectively.

Besso is a Lloyd's insurance broking group that was established in February 1995, with the assistance of B.P. Marsh, by a specialist team departing from Jardine Lloyd Thompson.  The company originally specialised in insurance broking for the North American wholesale market but, through acquisitions of businesses and teams, is now a multi-niche Lloyd's Broker with a turnover of £27,946,202 for the year ended 31^st December 2009 and profits before tax of £539,224 for the same financial year.

B.P. Marsh's investment consists of an equity investment of £735,000 and a subscription for loan stock of £2,540,000 which bears an annual coupon of 14 per cent. per annum. As part of the transaction Besso redeemed all of its preference shares, including £765,000 worth of preference shares held by Union Hamilton and £1,775,000 worth of preference shares held by Marsh Insurance Holdings Limited.

As well as the equity investment Brian Marsh Enterprises Limited and Mr. Michael Wade have also subscribed for loan stock, on the same terms as detailed above, of £765,000 and £1,020,000 respectively.

B. P. Marsh's proportion of the initial cash consideration and loan have been funded by the Company from its existing cash resources and by utilising £1.25m of the £4.325m Director's Loan that was put in place in June 2010.

Upon completion of the transaction, Mr. Brian Marsh stepped down as Chairman of Besso and Mr. Michael Wade was appointed as Chairman in his place.  At the same time, Ms. Camilla Kenyon, a director of the Company, was appointed as an additional nominee director on the Board of Besso.

Mr. Brian Marsh, Chairman of the Company, is a majority shareholder of Brian Marsh Enterprises Limited and a director of Besso. Consequently the subscription of loan stock is a related party transaction for the purposes of the AIM Rules.  The independent Directors of the Company (excluding Mr Brian Marsh and Mr Daniel Topping, being a director of Besso) consider, having consulted with its nominated adviser, Arbuthnot Securities Limited, that the terms of the loan stock are fair and reasonable insofar as the shareholders are concerned.

For further information:

B.P. Marsh & Partners Plc                                                               www.bpmarsh.co.uk

Brian Marsh OBE / Camilla Kenyon                                                     [phone]

Nominated Adviser

Arbuthnot Securities Limited

Nick Tulloch / Ben Wells                                                                      [phone]

Notes to Editors:

About B.P. Marsh & Partners Plc

B.P. Marsh's current portfolio contains 10 companies. More detailed descriptions of the portfolio can be found at www.bpmarsh.co.uk.

Over the past 20 years, 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 and half 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.

Jonathan Newman is the Group Director of Finance and has over 13 years' experience in the financial services industry. Jonathan advises investee companies through several non-executive board appointments and evaluates new investment opportunities.

Robert King is a Director and Group Company Secretary. He joined B.P. Marsh in May 2003 having started his career at PricewaterhouseCoopers. Since joining B.P. Marsh he has taken on responsibility for the Group's legal, compliance and secretarial functions and played a key role in the flotation of the Company.

Daniel Topping is a Member of the Chartered Institute of Securities and Investment (MCIS) and a Graduate Member of the Institute of Chartered Secretaries and Administrators (GradICSA). Daniel joined the Company in February 2007 and currently holds three non-executive board appointments.

Camilla Kenyon was appointed as Head of Investor Relations at B. P. Marsh in February 2009, having four years of prior experience with the Company. Since then she has also been appointed as Head of the New Business Department, with responsibility for coordinating new investment opportunities and Chairing the New Business Committee.

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