Biggest UK funeral firm to float with £250m price tag

Britain's largest provider of funeral services is to float on the Stock Exchange for about £250m.

The tastefully-named Dignity, which last year conducted 69,012 funerals - accounting for 11.7 per cent of total UK deaths - will place shares with investors before Easter.

The company operates 507 outlets across the UK - including the Bethnal Green parlour in London's East End, which has organised the sending-off of members of the gangster Kray twins.

The float will make instant multimillionaires of Dignity's five directors, headed by 60-year-old chief executive Peter Hindley. Directors own a 15 per cent stake, which will be worth £37m. Some of the shares will be sold on flotation but the "majority" of their holding will be left in the business, Mr Hindley said.

Dignity is number two in the funerals market to the Co-Operative group, which controls 14 per cent of the sector. But Dignity makes more revenues from deaths because it also runs a pre-arranged funerals plans business, which doubled in size last year.

Dignity said its business was "stable". Since 1950, about 600,000 people have died every year, reflecting the fact that people are living longer, but that the population is also rising. As well as organising burials, including the traditional service with horses and carriages, Dignity is also the largest operator of crematoria, running 21 nationally.

Dignity aims to raise up to £150m of new money, adding £50m more to its value than was thought at the start of the year when speculation intensified that it might come to the public market. The company said it would reduce its mezzanine debt, taken out last year when it securitised its business.

The fundraising, being run by Panmure Gordon, could make a quick profit for venture capitalists at Montagu, HSBC's former private equity arm, which owns 65 per cent of Dignity.