Bridgepoint Seeks $2.8 Billion Value in Rare Buyout Firm IPO

Bridgepoint Group, the buyout firm spun out of Royal Bank of Scotland Group in 2000, will go public in one of the biggest listings of a U.K. private equity firm in decades.

The firm plans to raise about 300 million pounds ($416 million) and list at least a quarter of its shares, according to a statement Tuesday. The offering, which is expected to value the company at about 2 billion pounds, will also include the sale of about 200 million pounds from existing holders, said a person familiar with the matter.

The buyout firm, which focuses on middle-market companies across Europe and owns stakes in Burger King franchises in the U.K. and a motorbike racing business, is seizing on an ebullient stock market that Bridgepoint’s own chairman said earlier this year was showing signs of being near a top.

Unlike the U.S., where firms like Blackstone Group Inc. and KKR & Co. went public more than a decade ago, British buyout groups have tended to remain small private partnerships still dominated by their founders or immediate successors. Closely held firms have been grappling with how to provide exits for founders, while also ensuring rising stars can monetize their stakes.

Middle market firms like Bridgepoint have also faced increasing pressure to diversify their offerings as they face greater competition that’s pushing up the cost of acquiring assets and pressuring returns. The buyout firm sold an undisclosed minority stake to what was then Dyal Capital Partners in 2018.

Bridgepoint is perhaps best known in the U.K. as a prior investor in Pret A Manger, a coffee-and-sandwich chain whose ubiquitous presence on the nation’s high streets is being used as a bellwether for the country’s post-pandemic revival.

The company “has been on its own journey of growth and diversification, increasing its total assets under management from 9 billion euros in 2011 to 27.4 billion euros as of 31 March,” chairman William Jackson said in the statement. “Today, Bridgepoint has an increasingly global footprint across Europe, North America and Asia.”

Bridgepoint plans to use at least some of the funds to expand into new strategies including infrastructure and real estate as well as to increase its presence in the U.S., according to the person familiar with the matter, who asked not to be identified discussing confidential information. The firm expanded into private debt markets with its purchase of EQT AB’s credit business last year.

At 2 billion pounds, Bridgepoint would rank among the biggest private equity businesses listed on the London Stock Exchange. The two largest, 3i Group Plc and Intermediate Capital Group Plc have a combined market capitalization of almost 18 billion pounds and both went public in 1994.

Listed peers in Europe include EQT, the largest buyout firm in the Nordic region, which made its trading debut in Stockholm less than two years ago, and Switzerland’s Partners Group Holding AG and France’s Eurazeo SE.

Bridgepoint last week took a minority stake in Itsu, the Asia-inspired food company, and in May teamed up with Astorg to buy Irish financial software company Fenergo. In March it agreed to sell a business called Calypso to Thoma Bravo in a deal that Bloomberg reported was valued at about $3.7 billion. That made it one of the biggest software deals in Europe this year.

The firm sold its Pret A Manger stake in 2018 to JAB, another investment firm.

Buyout firms have splurged $17 billion on takeovers of publicly traded British targets so far in 2021, the busiest start to a year since 2007. The deals mark a catch-up after some large global private equity funds avoided the U.K. in recent years. The country has endured some of the harshest Covid lockdowns, while dealing with supply chain and trade flow fears sparked by uncertainties about how Brexit would impact the country’s economy.

Bridgepoint said total operating income rose to 191.8 million pounds in the financial year 2020 from 144.8 million pounds in 2018. “Significant further profitable growth” has been achieved in the first quarter of 2021, it said.

©2021 Bloomberg L.P.

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