Fenchurch comes to the market

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The Independent Online
FENCHURCH, the Lloyd's of London insurance broker, is aiming to raise a net pounds 20.4m through a placing and offer of its shares on the stock market, writes John Moore.

The float will involve the issue of 18.7 million ordinary shares, of which 12.2 million are new ordinary shares. The remainder are being sold by existing shareholders. The offer price of the shares is 180p.

Fenchurch, formed in 1962, is coming to the stock market mainly in an effort to repay remaining bank debt incurred during an ambitious management buyout of the group in 1989.

Of the proceeds raised, pounds 15.3m will be used to repay the debt.

Fenchurch was owned by Guinness Peat, the financial group. In 1989 the then-executive directors of Fenchurch and certain members of staff, backed by Intermediate Capital Group and National Westminster Bank, carried out a management buyout from Guinness.

In the year ending 30 September, Fenchurch reported operating profits of pounds 6.9m, compared with pounds 4.9m a year earlier, on total revenues of pounds 30.3m.

The arrival of Fenchurch on the market may herald flotations by other brokers. Nelson Hurst is believed to be considering coming to the market next year.