Bain to acquire Esure in £1.2bn take-private

The proposed transaction values shares in the business at 280 pence apiece, equivalent to a 37% premium on the closing price on 10 August.

Esure generated a pre-tax profit of £36.1m in the first six months of 2018, according to publicly available documents, down from £45.1m in H1 2017. However, it attributes the fall to claims resulting from "a number of adverse weather events" in the first half of this year.

The consumer-focused insurance company, which specialises in automotive and home insurance, was founded in 2000 as a joint venture between Direct Line founder Peter Wood and Halifax. It was previously owned by Penta Capital and Epiris, which acquired it in a £270m deal in 2010 and listed it three years later with a market cap of £1.2bn.

As was recently reported by Unquote, the European PE market has seen a drastic increase in activity within the insurance space in the past two years. The estimated aggregate value of 2018 buyouts had already hit a post-crisis peak of €7.4bn prior to the proposed Esure transaction and with less than three quarters of the year elapsed, according to Unquote Data.

Bain is currently investing from its seventh flagship fund, which closed on $9.4bn in September 2017.

The Esure transaction is subject to regulatory and shareholder approval.

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