Succession is the next question that Towergate must answer

Towergate has had a tough start to the year, and its troubles aren’t over yet. Granted, the consolidator has raised £200m from private equity house Advent, securing its future in the medium term and paving the way for that longed-for flotation. But it has had to give up a hefty slice of equity in return – as much as 45%, according to ratings agency Moody’s. The deal is dependent upon Towergate raising £570m on the corporate bond market and sorting out its bank debt. And all by the end of next week.

But the looming deadline isn’t Towergate’s biggest problem: that comes once the deal is finalised. The surprise departure of deputy chief executive Amanda Blanc to AXA at the end of last year has left chairman Peter Cullum and chief executive Andy Homer without an obvious successor. Homer said this week that he and Cullum are staying at the helm; no doubt Advent has locked the door on Leadenhall Street and thrown away the key.

Cullum’s position might change, though. It’s full steam ahead for an IPO, and that could mean an independent chairman sooner rather than later. Cullum could end up vice-chair of the company that he founded and still has much of his fortune tied up in.

Homer’s successor is an even thornier problem. Clive Nathan and Tim Johnson are waiting in the wings, but might Homer (or his new shareholder) wish to look further afield? One thing’s for sure – Homer’s going nowhere until he’s found his successor.

That said, congratulations are in order too. However long they may have to hang around, Cullum and Homer have ensured that Towergate will outlast them. That’s something the other consolidators have yet to achieve. IT

ellen.bennett@insurancetimes.co.uk