Sun Capital, Osmond’s private equity firm, is already in the process of raising capital for the venture, and is understood to be preparing for a stock market listing early next year. It is thought he will have raised around £500m in capital and will aim to raise another £500m for when it floats.
Osmond is working on a list of potential targets that are struggling with debts and are close to breaching their lending agreements.
The serial entrepreneur has his eyes fixed on the dozens of British companies that are close to being overwhelmed by debt. Many firms used loans to finance expansion during the boom in credit over the past five years and are now facing difficulties as their debt is due for renewal.
About £150bn of debt used to finance buyouts is due to be repaid by the end of 2012.
Osmond has already been through a complicated debt restructuring deal, which led to the sale of
Pearl Group, his insurance business, to American private equity investors.
The deal, which involved a debt-for-equity swap with a group of banks and also a cash injection from New York-based Liberty of £500m, severely diluted Osmond’s combined holdings and influence in the group.
He believes many distressed companies still have strong underlying businesses with good management teams and cash flows. He will provide capital to help companies through restructuring, freeing from their debt burdens and allowing them to focus on future returns. He is known as a hands-on investor, who likes to take charge of running companies.
It is understood he will not be looking at financial services companies, but will be a range of sectors, particularly in the leisure industry where he has a long track record.
Osmond and his former business partner, Luke Johnson, the outgoing chairman of Channel 4, built up PizzaExpress business using a similar tactic. They bought sites at knockdown prices during the last recession to rapidly expand the business. They acquired the business for £18m and sold it for £279m.