Motor insurer makes a dream start on its debut
CAR insurer Sabre accelerated on its first day of trading with shares up 11.7pc.
The quirky insurer – known for its brands Go Girl, Drive Smart and Insure2Drive – sped past its initial placing price of 230p to 257p, valuing the company at £642.5m, a significant premium on its initial valuation of £575m.
Sabre specialises in writing policies for ‘non- standard’ drivers – such as graduates with no credit or sports car owners – who are unable to get cover from the major insurers.
It was formed in 1982 and bought by General Accident in 1996 before it was snapped up by Angus Ball and Keith Morris through their investment company BDML in 2002. The deal was for a reported £13.5m at the time, when its assets were valued at £23.5m.
BC Partners later bought a 78pc stake in the business in 2013 for around £240m.
The private equity firm sold more than half of its stake in the listing, retaining 34pc. Ball holds 10pc and Morris has 3pc. The pair are worth around £185m each, and were named 607th on The Sunday Times rich list this year. Recruitment firms Hays and
Page Group fell after Deutsche Bank downgraded their shares from ‘hold’ to ‘sell’.
Hays finished down 3.8pc, or 7p, to 175.4p while Page dropped 4.8pc, or 22.2p, to 440.6p after the German bank said the sector was overvalued, despite performing strongly overseas.
Both have done better than expected following the Brexit vote, having shifted growth overseas to offset uncertainty in the UK. But Deutsche said that while the strong international demand has boosted sales, margins have not benefited as much as hoped given record-low unemployment.
It said: ‘The overall view we have is that staffing valuations are living on borrowed time.
‘Unemployment rates in the US, UK and Germany are at multidecade lows and yet, despite this, we are not yet seeing price increases because of the pressure on margins.’
The FTSE 100 finished up 0.3pc, or 20.53 points, at 7348.03.
Marsh & Parsons and Your Move owner LSL Property Services nudged up after its boss bought £159,600 worth of shares.
Ian Crabb, who has been chief executive since 2013, bought 56,000 shares at £2.85 – sending the firm up 1pc, or 2.75p, to 284p.
Falling half-year profits failed to deter Stagecoach investors.
The transport operator was among the FTSE 250’s biggest risers after chief executive Martin Griffiths hailed the Government’s overhaul of the rail system, saying it would mean sales risk is shared more equally. Most train contracts lock in the amount companies like Stagecoach pay the Government, regardless of whether the franchise is generating strong sales.
But under new plans introduced by Transport Secretary Chris Grayling, the private sector and public sector will work more closely. Griffiths said the rail overhaul will mean the firm is less exposed to slumps in sales.
It came as Stagecoach posted falling profits in the six months to the end of October, with earnings coming in at £96.7m from £97.2m in the same period the year before. Sales fell to £1.8bn from £2bn largely due to lower bus revenue.
Despite the falls, Griffiths’ comments sent shares up 0.9pc, or 1.6p, to 178p.
EasyJet was lifted 1.3pc, or 18p, to 1444p after Investec upgraded it to ‘buy’.
Analyst Alex Paterson said: ‘We expect to receive EU approval of the Air Berlin acquisition soon, which should provide a further catalyst for the stock.’