Esure founder to remain at the helm as Bain Capital swoops for insurer in £1.2bn deal
THE insurance tycoon who set up Esure 18 years ago said he will stay at the wheel of his empire for some time, after the company agreed to be sold to Bain Capital for £1.2bn yesterday.
Sir Peter Wood, who has a 30.7pc stake in Esure, is in line for a £360m payday after the company said that it had agreed to be taken over by the US private equity giant at 280p a share cash.
“It’s not a windfall, I’ve worked 18 years doing this, I’ve been working since I was 19,” he told The Daily Telegraph. “I’ve probably paid more tax over the years than blooming Amazon’s paid over the whole year.”
The insurance guru, who set up motor insurer Direct Line before creating Esure in 2000, will invest £50m in the group if the deal passes the 75pc threshold needed for the deal to go ahead at a shareholder vote planned for early October. He said he will give the new owners “my two-penneth” and remain as chairman of the board “until they think I’m past it” and ask him to leave.
He said he does not plan to set up a rival firm once the sale completes as he has “plenty going on to keep my brain rattling around”. The 72-year-old is chairman of price comparison website Gocompare, has a successful investment portfolio and recently set up a property company.
The deal with Bain comes months after Sir Peter played down rumours about a sale, telling The Telegraph in January: “I’m not planning to sell my shares, I’m not planning to disappear. The investment banks are desperate for business. [It’s] a lot of noise but nothing of any substance.”
He said his mind was turned in April when Bain first approached him at his mansion in Palm Beach, Florida, saying it wanted to grow the business and keep all of its staff. There have been no other approaches.
When the talks first emerged on Monday shares in Esure shot up more than 30pc. They closed up 3.9pc at 277.6p yesterday.
Panmure Gordon analyst Barrie Cornes said: “Many investors have been looking for a suitable exit and in Bain they appear to have got [it].”
Esure agreed to the Bain deal on the same day as its first-half results, which showed that pre-tax profits had fallen 19pc during the period due to this year’s extreme weather conditions. Stripping out the costs of weather-related claims resulted in pre-tax profits rising 11pc, it said.