News

Successful exit from Bennetts MBO after only 11 months
Press release November 2003

Advantage Capital has just completed the successful exit from Bennetts, the high street insurance broking business, by way of a trade sale to Cox Insurance Holdings plc. This was our maiden investment and is right in line with our investment strategy, being a “difficult deal of real merit.“

Advantage Capital's investment strategy is to acquire intrinsically strong, well managed businesses in difficult circumstances. Bennetts is a prime example. Advantage Capital's equity syndicate acquired Bennetts in conjunction with its management team in November 2002. The business had run into trouble as a result of an unsustainable debt burden following a management buyout in 1999. What appealed to Advantage, however, were Bennetts' strong regional footprint of high street broking operations and its highly automated back office function in Worcester. Advantage knew that this would make it attractive to the larger, national insurance broking players in the market.

“The sale to Cox enables Bennetts to continue its expansion under the umbrella of a much larger organisation. It is a great fit and we are delighted with the result. Moreover, the deal provides a satisfactory 70% IRR on our fund's investment“, said Martin Bodenham and Trevor Jones of Advantage Capital.

Cox has a market capitalisation of approximately £250 million. The Bennetts' branches will be added to Cox's 21-strong insure-shop network, creating the 6th largest high street broking operation in the UK. The acquisition will produce a combined policyholder count in excess of 117,000 with a joint gross written premium income in excess of £44m. “There is a great geographical fit and real synergies given that both businesses have an approximate 80/20 split between motor and home business“, said Paul Bown, exiting Chairman of Bennetts.