TIG Topco Ltd, the holding company for Towergate, has announced that it is offering 40,000,000 new ordinary shares at a subscription price of £1 each.
Madison Dearborn Partners (MDP), an existing major shareholder, has confirmed its intention to subscribe to the offer.
TIG Topco Ltd is proposing to deploy the proceeds of the offer (£40,000,000) into several key strategic initiatives that are part of Towergate's ongoing transformation plan.
Furthermore prior to receipt of the investment MDP has agreed to provide the Towergate Group with up to £25,000,000 through a shareholder loan. To the extent that the Shareholder Loan is utilised, it will be repaid with part of the proceeds in the form of new shares.
TIG Topco Ltd has also announced that it has agreed an additional shareholder loan for the Towergate Group of up to £17,000,000 with Nevada Investments Topco Limited, an entity controlled by MDP and shareholders who are funds managed, advised and/or controlled by HPS Investments Partners LLC. This loan will be made available after the share offer completes.
David Ross, CEO of Towergate, said:
"Today marks another significant validation of our vision and is further endorsement of the integration and transformation programme that we continue to tackle.
We spent much of 2016 fixing our infrastructure and building a platform for growth which will be a formidable springboard for executing the next phase of our Fix, Build and Grow agenda.
We continue to invest heavily in a focused programme of strategic initiatives which our shareholders agree are key priorities. We are doing the right things in the right order to ensure we eliminate the complexities of the past and move at pace towards an integrated, streamlined Towergate.
Crucial to maintaining the speed at which we are continuing through the programme is the ability to complete the key fixes and to commit to new ones. The news today that MDP are enabling this through an immediate undertaking to invest in the business indicates not only the strength of our future ambition, but also of a business with strong underlying performance, yet to unlock the potential beyond a layer of inefficiency."