Oval is to raise as much as another £50m to fund a major acquisition drive as it aims to more than double its revenues by the middle of next year.
Chief executive Phillip Hodson said the consolidating giant was looking to raise the additional funds, which could take its war chest to £120m, to fund a string of anticipated deals in the 2008.
Hodson said the company was set to make three acquisitions in December, followed by four “large” additions in the New Year.
He revealed that Oval was aiming to double its revenues to £140m by the middle of 2009.
Last month, managing director Jeff Herdman said the company was looking to increase its revenues to £110m by the end of next year. But the revised target of £140m, if met, would place Oval on the cusp of the top 10 brokers in the UK.
The news came as Oval announced it had already raised a further £15m to its acquisition fighting fund, taking its total to £70m.
The additional funding, amounting to around £15m, is derived from Barclays Leveraged Finance and Lloyds TSB Corporate Acquisition Finance, which granted the consolidator an initial sum of £53m in March last year.
A further capital injection to fund acquisitions followed after Allianz purchased a 10% stake in the broker.
Hodson played down the impact of credit crunch in terms of securing capital backing, and said that prices for brokers remained robust despite external economic forces, including proposed changes to capital gains tax.
He said: “These are difficult times, but we have good profits. You are as good as your profits.”
Hodson also ruled out buying a network. He said: “We don’t see the value in [them].”
He said the imminent acquisitions were not geared to a particular region, but would be “across the UK” – although they were unlikely to be in the North East. He said that the acquisitions would be determined by quality, ahead of specification, though he acknowledged that the broker would “always be looking” at niche players.
Oval has made 23 acquisitions since its inception in 2003, including 14 this year. Hodson said a further acquisition had been made in the next two weeks.
For the year ended 31 May 2007, Oval’s general insurance business reported a 27% growth in general insurance brokerage from £47m to £60m, and posted group pre-tax profits of £4m.
