Hutton Collins, a mezzanine and preferred equity provider, is buying a 22 percent stake in the £33.7 million (€51.4 million; $67 million) management buyout and take-private of Windsor, a UK insurance broker, a statement said. Management will own the remaining 78 percent.
Windsor is listed on the London Stock Exchange and will be de-listed in late March, a statement said.
The deal values each Windsor share at 52.5p, a premium of about 23 percent over the closing mid-market price of 42.75p per Windsor share on 12 September 2006, the last business day before management made a formal approach.
Hutton Collins is providing equity and debt financing of £15 million, while KBC Bank, a Belgian bank focused on small to medium-sized business, is supplying £19 million of senior debt, according to a statement. Windsor staff is providing equity subscriptions of £6 million.
Windsor offers insurance and reinsurance broking services through its main subsidiaries, Windsor Professional Indemnity and Windsor Insurance Brokers.
In 2006, revenue increased to £22.2 million ahead of £20.6 million in 2005, pre-tax profit amounted to £5.3 million, a decrease of £200,000 the year before, and earnings per Windsor Share were 5.41p, an 11p fall from 2005.
Last year the rates of UK insurance risks continued to fall for a third consecutive year, prompting Windsor Professional Indemnity to form a risk assessment team.
Hutton Collins closed its second fund in September last year on €570 million, double the amount raised for its 2004 predecessor.
The firm was founded in 2002 by Graham Hutton, former chief executive at Morgan Grenfell Private Equity, and Matthew Collins, former global co-head of leveraged finance at Merrill Lynch.