The two lawyers behind Anexo Group plc – the listed business that owns leading personal injury law firm Bond Turner – are set to receive £46m after selling some of their shares to a private equity investor.
DBAY Advisors has agreed to acquire 29% stake of its issued share capital to help grow both the legal and credit hire side of Anexo’s business.
The vendors are barrister Alan Sellers, Anexo’s executive chairman, solicitor and Bond Turner managing director Samantha Moss, and Valentina Slater, the sales director of Direct Accident Management Ltd, the credit hire arm.
DBAY, an international asset management firm with offices in the Isle of Man and London, is paying 150p a share – a premium on the current share price, which jumped 10% on the news yesterday to 146p.
It will initially acquire 9.9% of group’s shares, moving to 29% once it secures regulatory approvals from the Financial Conduct Authority and the Solicitors Regulatory Authority. It is hoped this will happen within three months.
In all, Mr Sellers is selling some 15m shares for £22.6m and will still hold a further 20m shares, 17% of Anexo’s issued share capital. Ms Moss is selling 15.5m shares for £23.3m, leaving her with 20.6m shares (18%), and Ms Slater is selling three million shares for £4.6m, leaving her with 4.1m shares (3%).
In June, the trio sold smaller chunks of their shares at 125p as part of a fund-raise by the company to support the acquisition of WIP books and small law and credit hire firms; Mr Sellers earned £1.57m, Ms Moss £1.61m and Ms Slater £318,000.
Anexo has grown somewhat away from the legal limelight despite being listed for over two years.
The group operates a ‘direct capture’ model that brings in legal cases through its dedicated credit hire sales team and network of over 1,100 active referrers – such as body shops and garages – around the UK.
Bond Turner now employs more than 450 people. Headquartered in Liverpool, it expanded into Bolton in December 2018 and has finally secured premises for an office in Leeds that was delayed due to coronavirus. It will open in the first quarter of 2021.
Though DBAY is taking a minority stake, it will have the right to appoint up to three non-executive directors once the deal completes and sign an agreement with Anexo which restricts any material changes to its business model – including acquisitions, disposals and/or debt finance – without the majority consent of DBAY’s representatives on the board.
Mr Sellers said: “DBAY has an excellent track record of smaller company investment and we look forward to working closely with them to achieve growth across our various business divisions.”
DBAY partner and chief investment officer Saki Riffner said: “We are excited to invest in Anexo alongside Alan, who has built the business over the last 25 years, and we are looking forward to working closely with him and his team to drive the future growth of the group.”
Mr Sellers, Ms Moss and Ms Slater are expected to give undertakings precluding any further disposals of their remaining shareholdings for 18 months, while for a further 12 months they will not sell any part of their holdings below the price of the transaction.
In a trading update, Anexo said Covid-19 has led to a number of its credit hire competitors leaving the market, enabling the company to expand its network of introducer garages.
As a result, the number of vehicles on the road during the second half of 2020 has “consistently exceeded internal targets”, reaching 1,900 this week.
It said that, despite the decline seen at the start of the first lockdown, the average number of vehicles Anexo will have on the road in 2020 was expected to exceed the figure for 2019.
Bond Turner has also been targeting claimants for the Volkswagen emissions litigation and said it has secured some 13,155 cases as a result of its marketing campaign, and was exploring potential emissions claims involving other manufacturers.
Despite Covid, Anexo said it was trading “in line with management expectations” this year.