Saga outlines plan to sell half of firm to public if demand is high

 
Michael Bow
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OVER-50s holiday and insurance provider Saga could sell up to half of the business to retail and institutional investors if the company prices its forthcoming float on London’s stock market at the top end of its 185p to 245p price range.

The business, which was originally listed in London in 1978 before being taken private in 1990, said it hopes to raise initial proceeds of £550m through the offer – £37.6m of which will paid out in fees, mostly to banks on the deal.

If demand for shares is high and investors are willing to pay 245p, the company’s owner Acromas has the flexibility reduce its stake to below 50 per cent, excluding an over-allotment option.

The wide price range – going as low as 185p – is designed to make the offering more attractive to weary fund managers who have seen a number of floats go underwater this year. Saga will price the issue and start conditional dealing on 23 May before unconditional dealing on the market kicks off on 29 May.

Eight banks are currently working on the deal.

THE SAGA CONTINUES...

1 £2.6bn
The market cap of Saga if investors pay 245p a share

2 £37.6m
Fees to banks – excluding £9.8m for fees to sell shareholder stock

3 185p-245p
Indicative price investors will have to pay to buy a Saga share