Esure enjoys strong debut as Hastings keeps options open
ESURE has completed the biggest flotation in London so far this year, with the insurance group raising more than £600 million on its market debut.
However, rival Hastings said it was in no rush to follow suit as it reported a doubling in annual profits to £61 million.
Esure, founded by chairman Peter Wood in 2000, priced its shares at 290p each – towards the upper end of its original a 15-year search for the ideal location for a stand-alone Glasgow shop.
Like Forever 21, sports brand Vans has also opened its first Scottish store in Buchanan Quarter. Other retailers along the street-side development include Evans Cycles, Gap, Office, Skechers and Watches of Switzerland.
As a crowd of about 100 queued in the snow before Forever 21 opened its doors, Noel said the high street was not dying, but is in the grip of a dramatic transformation.
“What everyone has to understand is the UK has a population of 60 million people, and they all need to eat and they all need to buy clothes,” he said. “That is not going to change.”
What is changing is consumers’ behaviour and expectations. range of 240p to 310p – valuing it at £1.2 billion.
The flotation netted £554m for Wood and his fellow shareholders, including members of the management team and private equity firm Tosca Penta.
Esure, which employs more than 800 at its main customerfacing operations base in Glasgow, also raised about £50m through the sale of new shares to clear its debt.
Wood, who remains the firm’s largest shareholder, land- ed about £190m after reducing his stake to 30.9 per cent.
He said the strong market debut, which saw its shares close up at 307p in conditional trading, was a “ringing endorsement” of Esure’s prospects.
Yesterday’s flotation came five months after that of Direct Line, another insurer set up by Wood, but Hastings boss Gary Hoffman said he was keeping his options open.
Hoffman, the former chief executive of Northern Rock and acquisitions vehicle NBNK, said: “We don’t need external funding to fund our growth plans. We are expanding rapidly, and we are creating our own capital to reinvest in the business.”
Hastings, which has more than 1.1 million customers, said gross premiums rose 19 per cent to £423m during 2012.
Esure has almost two million customers and is expected to be eligible for inclusion in the FTSE 250 when unconditional trading in its shares begins next Friday.