Capital Markets, Financial

BGC Partners eyes new platform to trade US Treasuries

BGC Partners plans to launch a new platform to trade US Treasuries early next year, in a bid to return to a market in the middle of evolution, according to people familiar with the plans.  The company, spun out of Howard Lutnick’s Cantor Fitzgerald in 2004, sold eSpeed, the second-largest interdealer platform for trading Treasuries, […]

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Sales in Rocket Internet’s portfolio companies rise 30%

Revenues at Rocket Internet rose strongly at its portfolio companies in the first nine months of the year as the German tech group said it was making strides on the “path towards profitability”. Sales at its main companies increased 30.6 per cent to €1.58bn while losses narrowed. Rocket said the adjusted margin for earnings before […]

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Renminbi strengthens further despite gains by dollar

The renminbi on track for a fourth day of firming against the dollar on Wednesday after China’s central bank once again pushed the currency’s trading band (marginally) stronger. The onshore exchange rate (CNY) for the reniminbi was 0.28 per cent stronger at Rmb6.8855 in afternoon trade, bringing it 0.53 per cent firmer since it last […]

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Nomura rounds up markets’ biggest misses in 2016

Forecasting markets a year in advance is never easy, but with “year-ahead investment themes” season well underway, Nomura has provided a handy reminder of quite how difficult it is, with an overview of markets’ biggest hits and misses (OK, mostly misses) from the start of 2016. The biggest miss among analysts, according to Nomura’s Sam […]

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Spanish construction rebuilds after market collapse

Property developer Olivier Crambade founded Therus Invest in Madrid in 2004 to build offices and retail space. For five years business went quite well, and Therus developed and sold more than €300m of properties. Then Spain’s economy imploded, taking property with it, and Mr Crambade spent six years tending to Dhamma Energy, a solar energy […]

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Categorized | Insurance

Battle intensifies for control of Towergate

Posted on January 30, 2015

Directors of the heavily-indebted insurance broker Towergate are holding crunch talks as they weigh up rival restructuring proposals that will determine the fate of one of Britain’s biggest private companies.

The board, led by Alastair Lyons, is expected to reach a decision this weekend on the fate of Kent-based Towergate, which employs about 5,000 people at more than 120 offices.

People familiar with the situation indicated the board might favour a bid from a group of secured creditors. However, no decision had been taken as of Friday night.

    At least two other parties have tabled rival last-minute proposals. A group of unsecured bondholders — led by KKR, the Bain Capital affiliate Sankaty Advisors, and alternative investment manager Highbridge — has offered to inject £200m into Towergate as part of their plan, according to people with knowledge of the situation.

    Meanwhile, Marsh & McLennan, the US-listed broker that has been eyeing Towergate for several weeks, has made a cash offer of more than £600m. The final bid from Marsh, which declined to comment, was first reported by the Insurance Insider trade publication on Friday evening.

    A series of buyout houses, hedge funds and other investors are scrambling to minimise losses from Towergate, one of the UK’s largest insurance brokers.

    It has run into financial difficulties after a debt-laden acquisition spree and a big drop in profits. Debt holders are collectively owed about £1bn.

    Secured creditors that hold about two-thirds of the company’s £715m worth of senior debt have proposed buying the equity for £1 in return for reducing the amount they are owed in a “prepackaged” administration — in effect the pre-negotiated sale of an insolvent business.

    People with knowledge of the process highlighted that the plan from the secured creditors, being advised by Moelis, would leave the company with less debt leverage.

    However, the unsecured bond holders — whose bonds are trading at 13p in the pound — would face heavy losses under the plan.

    Under their rival plan, Towergate would avoid administration. Instead, the unsecured creditors — being advised by Houlihan Lokey — would convert their debt into equity, and plough cash into the business.

    Towergate’s equity backer, the buyout group Advent, would be wiped out under both proposals.

    A bill on Towergate’s debt pile is due on Monday to secured creditors. Another payment, to the unsecured creditors, is due two weeks later. Together they are estimated to total about £30m.

    Towergate hired Evercore and Rothschild in November to advise on its future. They warned it might not survive as a going concern if a restructuring could not be agreed.