Ex-Brightside boss Banks seeks private equity backing to delist

Former Brightside chief executive Arron Banks is planning on a private equity backing to buyout the company’s stock and return it to a private company.

And if he succeeds in securing private equity backing, Banks has said could eye up a deal for van broker Autonet.

Banks, whose resignation was announced this morning, told Insurance Times: “The background is that we’ve had fabulous results. Last set of were cracking, though our share price is down the dumps, along with everybody else.

“We’re highly cash generative, have a good balance sheet and we are growing.  So the story is very much take it out the PLC arena, put it back into private hands and build the business faster and better.”

One of the first things Banks will examine if he successfully delists, is a bid for Autonet.

Banks said: “It would be a very good business to combine with ours. We’re much bigger, three times bigger, but actually it would gives us bulk in all the areas we’re interested in.

“That’s definitely something that I’ll get my mind around to in a private Brightside. In terms of what I might do, that would be a deal that would be pretty high on the agenda.”

To succeed Banks will have to buyout institutional investors, who hold around 20% of the stock. However, the deal should be considerably easier than most as management hold around 40% of the shares.

Insurance broking director Martyn Holman will take control in the interim.

Brightside’s share price has been hovering around 20p mark this year, despite a 44% rise in after-tax profits. Brightside made a profit after tax of £9.4m in 2011, up 44% on the  £6.5m it made in 2010.

The improved profit came on the back of a 22% increase in revenues to £80.4m (2010: £66.2m). Policy sales increased 41% to 444,189 (2010: 339,916).