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Saga prices IPO at bottom of indicative range

23 May 2014

insurance contract formPrivate equity-backed UK over-50s insurance company Saga has reportedly priced its IPO at the bottom of the indicative range.

Saga, which is backed by private equity firms Permira, Charterhouse and CVC, will price its shares at 185 pence each, giving it a market cap of £2.03bn, said Reuters, citing two sources familiar with the matter.

Saga will sell £550m worth of new shares via the IPO and there is a 15 per cent greenshoe for secondary shares, which enables shareholders to part-exit their stakes, said the people.

Last month it was reported that Saga was planning to raise £550m via an IPO.

The company plans ot use the IPO proceeds to reduce its debt pile to £700m.

Saga focuses on providing services to people over 50 and currently has 2.1m customers.

Over the past three years, Saga has seen its EBITDA grow at an annual rate of 7.4 per cent as revenues rose 4.7 per cent per year. In the fiscal year to end January, Saga posted an EBITDA of £222.4m on revenues of £1.21bn.

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