Gresham looks to create another Giles

Private equity firm Gresham is looking for a specialist broker with the potential to be another Giles.

Gresham last week invested £12.3m in the management buy-out (MBO) of Lanes Assistance Services (LAS), a claims management firm .

The firm’s partner Simon Hemley said the private equity house now aimed to repeat the Giles story.

Gresham led an MBO in 2006, and is thought to have nearly tripled its profits in two years, selling its stake to Charterhouse Capital for a sum believed to be in the region of £185m.

Hemley said: “We are still very actively pursuing opportunities within distribution – some form of broker, albeit this time round it would probably be a specialist niche insurance broker rather than a general lines broker.

“A typical Gresham investment is anywhere between £5m and £100m. I suspect that, for a specialist niche broker, we would be looking at the lower end of this range, between £5m and £50m.”

“One of the attractive features about pursuing an opportunity within this sub-sector is the possibility of making bolt-on acquisitions in a fragmented market,” Hemley added.

“We experienced tremendous success with this strategy with Giles, and view a specialist broking platform as a fantastic opportunity for growth.”

Hemley said that he was attracted to LAS because of its potential to expand product offering and technologies, and the potential for cost savings for insurer partners.

Gresham has also not ruled out further investment in LAS, with the possibility of adding an acquisition to the business.

“We have significant investment at our disposal that we’re happy to invest in LAS, as and when it is called for, in order for the business to grow and achieve what we believe it is capable of achieving,” he said.

The LAS?management buy-out is led by managing director Darren Cooper and commercial director Tim Walker.

Cooper said: “The investment will ensure that the |high level of customer service that LAS provides is maintained as volume increases, and that future growth is managed in a controlled manner.”