RCapital-backed Morses Club floats with £140m valuation

The IPO consists entirely of existing shares, with RCapital receiving all £68.5m of proceeds generated.

However, according to the company's admission documents, Morses intends to use its new status as a public company to raise capital through the issuing of new shares in the future. It also hopes to benefit in the short term through the broadening of its investor pool.

Upon completion of the placement, which prices Morses shares at 108 pence apiece, the GP will retain a 51% stake in the business.

Panmure Gordon and Numis Securities acted as joint bookrunners and joint brokers in the process.

The exit marks just the third IPO for a PE- or VC-backed British company this year, according to unquote" data. By contrast, there were 12 such IPOs in 2015 and 31 in 2014.

Previous funding
Turnaround specialist RCapital acquired Morses Club from administrators for an undisclosed sum in April 2009. The GP then bought Shopacheck Financial Services from Welcome Financial Services in 2014, before merging the two companies in March 2015.

Company
Founded in 1927 and headquartered in Birstall Batley, Yorkshire, Morses works with around 2,500 self-employed agents who sell small cash loans of between £100-1000. The company operates from a network of 100 bricks-and-mortar branches, with agents collecting repayments from customers' homes on a weekly basis.

The business generated revenues of £90.6m in the year ending February 2016 with £16.8m of adjusted profit before tax.

People
Morses Club – Paul Smith (CEO).

Advisers
Company – Deloitte, Chris Nicholls, John Ball, Craig Lukins (corporate finance); Dentons, Jonathan Polin, Darren Acres (legal).

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• Topics
• Exits
• UK / Ireland
• Financials
• United Kingdom
• RCapital
• IPO