Float brings windfalls to eXchange

THE CHIEF executive of an electronic trading platform for financial advisers will net shares worth pounds 80m following a decision to float the company on the Stock Exchange.

Paul Lindsey, aged 41, co-founded The eXchange in 1991 as a means of helping advisers get computer quotations from life insurers on pensions, mortgages and savings. The group was jointly owned by the life offices until February last year, when Mr Lindsey and three other directors got backing from Apax Partners for a management buyout.

The eXchange yesterday announced its intention to seek a full listing, expected to value the company at pounds 400m. The four directors share a 50 per cent stake in the group.

Two of Mr Lindsey's co-founders, David Chislett, 37, and Nigel Phillips, 35, have 10 per cent stakes, bringing them fortunes of pounds 20m each. Nick Prestwich, 35, who joined in 1993, will also net pounds 20m.

Other employees will share a 5 per cent stake worth pounds 20m. The group said most of them were planning to keep their shares. The group makes its money by charging subscriptions to financial advisers, and fees to life insurers, for publishing low-cost quotations.

In December it launched an Internet-based consumer service, moneyeXtra. This allows consumers free access to a range of financial information, allowing them to choose between financial products such as mortgages.

Mr Chislett, the finance director, said the site differed from other Internet ventures in that revenue did not depend purely on advertising or subscriptions. Instead it would pick up referral fees when customers choose a product.

The pounds 400m valuation is expected in spite of the fact that the group still makes a loss. Estimates were based on valuations for loss-making financial data groups listed in the US.

Mr Lindsey said: "We are coming to market at a time of what appears to be unprecedented consumer appetite for information about personal financial planning. Our infrastructure and reputation gives us a significant opportunity."