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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Abbey Protect. | LSE:ABB | London | Ordinary Share | GB00B293ZK84 | ORD 1P |
| Price Change | % Change | Share Price | Shares Traded | Last Trade
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|---|---|---|---|---|---|
| 0.00 | 0.00% | 114.50 | 0.00 | 01:00:00 |
| Bid Price | Offer Price | High Price | Low Price | Open Price | |
|---|---|---|---|---|---|
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| - |
| Last Trade Time | Trade Type | Trade Size | Trade Price | Currency |
|---|---|---|---|---|
| - | O | 0 | 114.50 | GBX |
Abbey Protection (ABB) Share Charts1 Year Abbey Protection Chart |
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1 Month Abbey Protection Chart |
Intraday Abbey Protection Chart |
| Date | Time | Title | Posts |
|---|---|---|---|
| 31/1/2014 | 15:16 | Abbey Protection - niche insurer for professional fees | 257 |
| 05/9/2011 | 14:58 | Abbey Protection - Predictably Good Results | - |
| Trade Time | Trade Price | Trade Size | Trade Value | Trade Type |
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Posted at 31/1/2014 11:20 by masurenguy Crest accounts were credited on schedule today, with the proceeds from the acquisition of Abbey Protection by Markel Capital Holdings. The amount credited was 115p per share. Open Spread positions with IG Index will close automatically @115p as soon as they receive hedged funds from their broker, which could be later today or next week. I assume other Spread Betting companies will close positions on a similar timeframe.At an average buying price of 69p I locked in an overall capital gain of 46p or 66.7% plus 24.4p in dividends, so I doubled my money in just under 5 years. Not spectacular - I have other shares notably ETO, CMS, GBO, PHTM and RNWH that have delivered much higher growth rates over a shorter timescale - but nevertheless ABB was a very solid and dependable share with a good yield. I also obtained a 2.7% arbitrage bonus (equivalent to an annualised return of 11.1%) by taking a spread position @112p in early November, when the price slipped after some existing impatient holders sold out early. This was my 5th largest holding so it is now a question of where to reinvest the proceeds! Good luck to exiting ABB shareholders & success in redeploying these funds. |
Posted at 20/1/2014 07:58 by masurenguy Timetable remains on schedule.RNS Number : 8303X 17 January 2014 TEMPORARY SUSPENSION OF TRADING ON AIM ABBEY PROTECTION PLC At the request of the Company trading on AIM for the under-mentioned securities has been temporarily suspended from 17/01/2014, 7:30am, pending an announcement. RNS Number : 9745X 17 January 2014 RECOMMENDED CASH ACQUISITION of Abbey Protection by Markel Capital Holdings Ltd Court confirmation of Reduction of Capital and Scheme effective Under the terms of the Acquisition, Abbey Protection Shareholders will be entitled to receive 115 pence in cash for each Abbey Protection Share (the "Acquisition Price"), valuing the entire issued and to be issued share capital of Abbey Protection at approximately £116.5m. The Reduction of Capital required to effect the recommended acquisition of Abbey Protection by way of a scheme of arrangement under Part 26 of the Companies Act 2006 was today confirmed by the Court and, following the delivery of the Court Orders to the Registrar of Companies, the Scheme has become effective. The Court Hearing to sanction the Scheme took place on 14 January 2014 and the last day for dealings in Abbey Protection Shares was 16 January 2014. The Court Hearing to confirm the Capital Reduction took place earlier today and the Scheme has become effective today. It is expected that the admission of the Abbey Protection Shares to trading on AIM will be cancelled on 20 January 2014 or shortly thereafter. RNS Number : 9882X 20 January 2014 Abbey Protection plc NOTICE OF CANCELLATION OF ADMISSION TO TRADING ON AIM At the request of the company trading on AIM has been cancelled from 20/01/2014 7:00am |
Posted at 06/1/2014 12:46 by masurenguy RNS Number : 8704WAbbey Protection PLC 06 January 2014 RECOMMENDED CASH ACQUISITION of Abbey Protection plc by Markel Capital Holdings Limited Receipt of regulatory approvals from the FCA, the GFSC and the SRA On 9 October 2013, the boards of Markel Capital Holdings Limited ("Markel"), a wholly-owned subsidiary of Markel Corporation, and Abbey Protection plc ("Abbey Protection" or the "Company") announced that they had reached an agreement on the terms of a recommended cash acquisition of the entire issued and to be issued share capital of Abbey Protection by Markel (the "Acquisition"). The Acquisition is to be implemented by way of a scheme of arrangement under Part 26 of the Companies Act 2006 (the "Scheme"). Under the terms of the Acquisition, Abbey Protection Shareholders will be entitled to receive 115p in cash for each Abbey Protection Share, valuing the entire share capital of Abbey Protection at approximately £116.5m. The scheme is conditional on receipt of regulatory approvals from the FCA, the GFSC and the SRA. Abbey Protection today announces that it has now received requisite approvals from all three regulatory bodies. The Court Hearing to sanction the Scheme is expected to take place on 14 January 2014 and the Court Hearing to confirm the Capital Reduction is expected to take place on 17 January 2014. It is expected that the last day for dealings in Abbey Protection Shares will be 16 January 2014 and the Scheme will become effective on 17 January 2014. If the Scheme becomes effective on 17 January 2014, it is expected that the timetable relating to the delisting of shares from AIM, and the crediting of shareholders accounts with the proceeds of their share sales, will remain unchanged as January 20th and January 31st respectively as previously announced in the RNS issued on 2nd December 2013 (see post #253 above) |
Posted at 03/12/2013 17:24 by masurenguy RNS Number: 4614U Abbey Protection PLC 02 December 2013 RECOMMENDED CASH ACQUISITION of Abbey Protection plc by Markel Capital Holdings Limited (to be implemented by way of a scheme of arrangement under Part 26 of the Companies Act 2006) Results of Court Meeting and General Meeting On 9 October 2013, the boards of Markel Capital Holdings Limited ("Markel"), a wholly-owned subsidiary of Markel Corporation, and Abbey Protection plc ("Abbey Protection" or the "Company") announced that they had reached an agreement on the terms of a recommended cash acquisition of the entire issued and to be issued share capital of Abbey Protection by Markel (the "Acquisition"). The Acquisition is to be implemented by way of a scheme of arrangement under Part 26 of the Companies Act 2006 (the "Scheme"). Abbey Protection announces that the Scheme relating to the acquisition of Abbey Protection by Markel was today approved at the Court Meeting and the special resolution was approved at the General Meeting. Under the terms of the Acquisition, Abbey Protection Shareholders will be entitled to receive 115p in cash for each Abbey Protection Share (the "Acquisition Price"), valuing the entire issued and to be issued share capital of Abbey Protection at approximately £116.5m. VOTING RESULTS The voting results in relation to the Court Meeting and the General Meeting are summarised below: COURT MEETING At the Court Meeting, a majority in number of Scheme Shareholders who voted (either in person or by proxy), representing 96.93% by value of those Scheme Shares voted, voted in favour of the resolution to approve the Scheme. The resolution proposed at the Court Meeting was decided on a poll. Details of the votes cast were as follows: Number of Scheme Percentage Number of Scheme Percentage (%) Shareholders (%) Shares voted who voted FOR 83 85.57 81,435,538 96.93 AGAINST 14 14.43 2,575,914 3.07 Accordingly, the resolution proposed at the Court Meeting was duly passed on a poll vote. The number of Scheme Shares voted in favour of the resolution as a percentage of the Scheme Shares in issue at the Voting Record Time was 96.93% and the number of Scheme Shares voted against the resolution as a percentage of the Scheme Shares in issue at the Voting Record Time was 3.07%. GENERAL MEETING The special resolution proposed at the General Meeting was passed by the requisite majority on a poll. The voting results for the Special Resolution were as follows: Number of Abbey Protection Percentage (%) Shares voted FOR 81,437,051 92.030 AGAINST 7,050,914 7.968 VOTE WITHHELD 1,500 0.002 Next Steps Completion of the Scheme remains subject to the satisfaction or, if permitted, waiver of the remaining conditions of the Scheme set out in the Scheme Document dated 4 November 2013 (the "Scheme Document") including, inter alia, the sanction of the Scheme and the confirmation of the Capital Reduction by the Court. The Court Hearing to sanction the Scheme is expected to take place on 14 January 2014 and the Court Hearing to confirm the Capital Reduction is expected to take place on 17 January 2014. It is expected that the last day for dealings in Abbey Protection Shares will be 16 January 2014 and the Scheme will become effective on 17 January 2014. If the Scheme becomes effective on 17 January 2014, it is expected that the admission of the Abbey Protection Shares to trading on AIM will be cancelled on 20 January 2014 or shortly thereafter. A timetable of the key remaining events is set out below: Scheme Court Hearing (to sanction the Scheme): 14 January 2014 Last day of dealings in, and for registration of transfers and disablement in CREST of Abbey Protection Shares: 16 January 2014 Dealings in Abbey Protection Shares on AIM suspended: 5.00 p.m. on 16 January 2014 Scheme Record Time: 6.00 p.m. on 16 January 2014 Reduction Court Hearing (to confirm the Capital Reduction): 17 January 2014 Effective Date of the Scheme: 17 January 2014 Cancellation of admission to trading on AIM of, and cessation of dealings in, Abbey Protection Shares: 7.00 a.m. on 20 January 2014 Dispatch of cheques and crediting of CREST accounts for cash consideration due under the Scheme by 31 January 2014 Long-stop date, being the date by which the Scheme must be implemented: 30 April 2014 The dates stated above are indicative only and will depend, among other things, on the date upon which the Court sanctions the Scheme and confirms the Associated Capital Reduction and the date on which the conditions set out in Part III of the Scheme Document are satisfied or (if capable of waiver) waived. If any of the expected dates change, Abbey will, unless the Panel otherwise directs, give notice of the change by issuing an announcement through a Regulatory Information Service. Except as otherwise defined herein, capitalised terms used herein have the same meanings as set out in the Scheme Document. |
Posted at 04/11/2013 15:30 by masurenguy Everything still on track here !RNS Number : 1563S Abbey Protection PLC 04 November 2013 RECOMMENDED CASH ACQUISITION of Abbey Protection plc by Markel Capital Holdings Limited Posting of Scheme Document On 9 October 2013, the boards of Markel Capital Holdings Limited ("Markel"), a wholly-owned subsidiary of Markel Corporation, and Abbey Protection plc ("Abbey Protection" or the "Company") announced that they had reached an agreement on the terms of a recommended cash acquisition of the entire issued and to be issued share capital of Abbey Protection by Markel (the "Acquisition"). The Acquisition is to be implemented by way of a scheme of arrangement under Part 26 of the Companies Act 2006 (the "Scheme"). Under the terms of the Acquisition, Abbey Protection Shareholders will be entitled to receive 115 pence in cash for each Abbey Protection Share (the "Acquisition Price"), valuing the entire issued and to be issued share capital of Abbey Protection at approximately £116.5 million. Abbey Protection is today posting a circular (the "Scheme Document") to the holders of Abbey Protection Shares, and, for information only, to Abbey Protection Share Incentive Scheme Participants and persons with information rights, together with the associated Forms of Proxy. The Scheme Document contains notices convening the Court Meeting and General Meeting and contains, amongst other things, the full terms and conditions of the Scheme, an Explanatory Statement pursuant to section 897 of the Companies Act 2006, an expected timetable of principal events and details of the actions to be taken by Abbey Protection Shareholders. The expected timetable of principal events is attached as an appendix to this announcement. An announcement will be made if any key dates set out in the expected timetable change. To become Effective, the Scheme will need to be approved at the Court Meeting and will require the passing of a special resolution at the General Meeting, in each case, by the requisite majorities, as described in the Scheme Document. The Scheme is also subject to the satisfaction or, if capable of waiver, waiver of the other Conditions set out in Part III of the Scheme Document, including the receipt of any required approvals from, or the expiry of any applicable waiting periods imposed by, the FCA, the SRA and the GFSC. Notices for the Court Meeting and the General Meeting are set out in the Scheme Document. The Court Meeting and the General Meeting will both be held at the offices of Eversheds LLP, One Wood Street, London EC2V 7WS on 2 December 2013. The Court Meeting will start at 11.00 a.m. and the General Meeting will start at 11.15 a.m. (or as soon thereafter as the Court Meeting has been concluded or adjourned). Abbey Protection Share Scheme Participants will be sent further details of the impact (if any) of the Scheme on their options and proposals being made to them on the date of this announcement. Holders of Abbey Protection Shares should carefully read the Scheme Document in its entirety before making a decision with respect to the Scheme. The Scheme Document will today be made available on Abbey Protection's website at www.abbeyprotectionp Appendix EXPECTED TIMETABLE OF PRINCIPAL EVENTS The dates given are based on Abbey Protection's current expectations and may be subject to change. If the expected date of the Court Hearing is changed, Abbey Protection will give notice of such change by issuing an announcement through a Regulatory Information Service and posting notice of the change to Abbey Protection Shareholders. All Abbey Protection Shareholders have the right to attend the Court Hearing. All times shown in this document are London times unless otherwise stated. Event. Time and/or date Latest time for lodging Forms of Proxy for the: Court Meeting (blue form) 11.00 a.m. on 28 November 2013(1) General Meeting (white form) 11.15 a.m. on 28 November 2013(2) Voting Record Time 6.00 p.m. on 28 November 2013(3) Court Meeting 11.00 a.m. on 2 December 2013 General Meeting 11.15 a.m. on 2 December 2013(4) Scheme Court Hearing (to sanction the Scheme) 14 January 2014 Last day of dealings and registration of transfers and disablement in CREST of Abbey Protection Shares 16 January 2014 Dealings in Abbey Protection Shares on AIM suspended 5.00 p.m. on 16 January 2014 Scheme Record Time 6.00 p.m. on 16 January 2014 Reduction Court Hearing (to confirm Capital Reduction) 17 January 2014 Effective Date of the Scheme 17 January 2014 Cancellation of admission to trading on AIM of, and cessation of dealings in, Abbey Protection Shares 7.00 a.m. on 20 January 2014 Dispatch of cheques and crediting of CREST accounts for cash consideration due under the Scheme by 31 January 2014 Long Stop Date 30 April 2014 |
Posted at 10/10/2013 13:53 by cnx from the daily mail................"The share price fall said it all, the company is being sold on the cheap. Abbey Protection, the AIM-listed supplier of legal and professional fees and insurance to SMEs, lost 4.75p or 4 per cent to 115p following news of a recommended £116.5million or 115p-a-share cash offer from Markel. The US insurer said that it had obtained irrevocable acceptances from directors and management in favour of the offer, totalling 57 per cent of the share capital, while Canadian investor and 10 per cent shareholder Mawer had also signed a letter of intent to accept the bid. Share price fall: AIM-listed Abbey Protection is being sold on the cheap Share price fall: AIM-listed Abbey Protection is being sold on the cheap Sid Lall, lead fund manager at Hargreave Hale which owns 6 per cent of Abbey Protection, is livid. 'It is highly unusual to have management agreeing to a bid that is at a discount to the prevailing share price. It is selling a profitable company short and in doing so is showing a total disregard to other shareholders whose aim as always is to maximise shareholder value,' he insisted. Abbey chairman Tony Shearer said: 'The board believes the acquisition by Markel gives Abbey an exciting opportunity to build a platform for further growth through Markel's scale and financial strength.' Maybe, but not at 115p. The deal is still subject to shareholder approval and Hargreave Hale will be canvassing support to try to get Markel to bid the right price. That would be at least 15 per cent higher than the current offer but Markel has stated 115p is its full and final offer............... |
Posted at 10/10/2013 08:06 by masurenguy WokingBlade - 240 "I can't see any justification for management accepting an offer at this level. I think they are neglecting their fiduciary duty. Perhaps Mas will sell his car to us for 5% less than its cost to him. the body of evidence for takeovers at a market premium vs discount suggests something awry here"An utterly ridiculous allegation and a totally absurd analogy - the price at which anyone buys or sells any share fluctuates on a daily basis and there are no absolute values that can be attributed to any stock other than NAV. What exactly do you think is "awry here"? If you think that there is anything non-kosher about this deal then why don't you approach the FSA, Takeover Commission or the institutional shareholders and report your concerns instead of just resorting to pure innuendo. Management, who own 57%, are perfectly entitled to recommend this offer and if enough shareholders to make up the necessary balance of 18% also approve then it is a done deal. There are absolutely no ramifications whatsoever in relation to their "fiduciary duty" where accepting this deal is concerned. You, myself or anyone else may disagree with the 115p acquisition shareprice but it is apparent that more than 75% of the shareholders have, or will, vote to accept it. It is called democracy and sometimes the majority view is at odds with minority opinion. Abbey diretors to pick up £65m after insurer is sold to Markel of US Directors and executives at Abbey Protection will share £65m between them after accepting a takeover offer from its US rival Markel. Colin Davidson, the chief executive of the specialist insurer, will collect £18m, as will managing director Chris Ward. Liz Grace, who runs the company's tax division, will pick up £12m. The £116.5m deal has already been backed by investors holding 67 per cent of the group's shares. Tony Shearer, the chairman of the AIM-listed group, said: "As Abbey Protection looks to the next stage of its growth strategy, the board believes that now is the right time for a change of ownership. Markel Corporation is a highly regarded insurer with an international reputation and has a strong track record in providing specialist insurance products to SMEs." Abbey Protection posted pre-tax profits of £5.2m in the six months ending 30 June on revenues of £20.7m. The company, founded in 1992, employs 275. It is understood its management team will stay on for an unspecified period before handing over to a new team. William Stovin, the president of Markel International, said: "From our first meeting, it was clear that there was a strong cultural fit between our organisations, and we are looking forward to working with the Abbey Protection management. "It's our expectation that Abbey Protection will continue to operate under its own successful brand, while our capital and risk appetite will enable it to retain more underwriting risk and to explore growth initiatives currently beyond its reach." British insure BRITISH insura Abbey's board unanimously recommended the deal for approval at 115p a share, despite the shares having traded above this level for most of the last three months. Invest Abbey, headquartered on Minories in the City's insurance district, will now become part of the US insurance group. It is expected to continue to operate under its own name for the forseeable future. "From our first meeting it was clear that there was a strong cultural fit between our organisations," said Markel president and chief operating officer William Stovin, who indicated key Abbey staff would remain with the company. |
Posted at 09/10/2013 08:52 by masurenguy What an unsatisfactory deal - why are management prepared to accept an offer at a 4% discount to the average share price over the past month? With the insiders holding 57%, and the largest external shareholder Mawer holding 10%, all committed to accept this offer it looks like a done deal since one must assume that they will also have obtained an indicative agreement from a couple of the other institutional shareholders for the balance of 8% in order to gain the necessry shareholder approval.In terms of validating the offer price, the statement in the Scheme Document that the price of 115p represents a " premium of approximately 43.8 per cent. to the average Closing Price of 80.0 pence per Abbey Protection Share between the date of admission of Abbey Protection Shares to trading on AIM ("Admission") on 29 November 2007 and 8 October 2013, being the last practicable day prior to the date of this announcement" is just crass - since when does any meaningful acquisition price reflect a comparison with an average price over a 6 year period since an original IPO ? These would appear to be the three main motivations for the BoD accepting this offer at this point in time. 1. "after more than 20 years successfully running Abbey Protection, the team are keen to realise their investment in the business in a timely and appropriate manner 2. Markel has made it clear to the Board of Abbey Protection that it will not increase the Acquisition Price above 115 pence per Abbey Protection Share and the Board of Abbey Protection has not received any offer from any other party 3. Following the Acquisition becoming Effective, it is Markel International's intention that Chris Ward, Abbey Protection Group Managing Director, and Colin Davison, Abbey Protection Group Chief Executive, will continue to lead the Abbey Protection management team" I don't blame management for wanting to cash in their chips and had always assumed that a takeover would be the final exit route but the price represents a rather disappointing deal given its recent level. It would seem that no other deal was on the table at this time and therefore they were happy with 'the bird in hand' which will net both Ward and Davison £18m each before tax. I guess that Mawer were also happy to make an 20% turn on their investment (including 9.4p in dividends) in just 9 months. Personally I will have doubled my money (a capital gain of 67% plus a further 35% in dividends) since I first invested here some four and a half years ago so it has still been a very positive outcome. I would have looked for an exit price of perhaps 125p - 130p at this point in time but, given the inside shareholders desire to sell the company over the past year, it just boils down to the old adage that the business is worth what anyone else is prepared to pay for it at a particular moment in time ! |
Posted at 28/9/2012 12:40 by masurenguy Hi Mayn - I'm sure that the recent price rally has further vindicated your investment here in addition to the consistent increase in yield over the past 3 years. In my own case that yield now constitutes circa 7%Masurenguy - 28 Nov'11 96: Very interesting to see that ABB is the largest individual stock holding (@13%) within TMF Deputy Editors (Maynard Paton) own personal portfolio......Abbey Protection representing almost one third of his investment in individual shares. I think that despite this recent rally, the share price still has considerable further potential to grow. With a likely eps in the region of 8p this year the current PER @94p is circa 11.7 and when you deduct free cash of circa £16m from the equation the EV/ER drops below 10. This is still quite a modest valuation when you consider that it also produces a yield at the current shareprice of circa 5.2%, if the year end dividend increases on a pro rata basis to the interim payment. In addition to the current free cash position, the company has no debt or pension deficit and the strength and resilence of its business model has clearly been demonstrated throughout the market volatility over the past 4 years. Even the loss of a major client like Southern Cross, who went into administration last year, was quickly absorbed with the only material consequence being that it diluted the increase in profits. As the company stated at the interims: " Renewal rates for our existing scheme and affinity clients were strong and £0.75m of new business in the first half of the year has demonstrated that the pipeline remains healthy." Furthermore, as fund manager Gervais Williams stated some six months ago the price to book ratio is three, which is the second highest in the insurance sector and return on equity is nearly 27%. Grahamburn - 19 Sep'12 138: My only niggle and concern is that the licence for new legal work seems to be taking too long and the directors comments are somewhat repetitive. Have a nagging doubt that it will materialise (ie the delays don't quite add up to usual bureaucratic rede tape). If it doesn't happen then some of the forward-looking positivity in the share price may evapourate. I see no reason whatsoever to doubt that the company will obtain their ABS license. That will facilitate an expansion of their range of legal services, which should enable them to quickly exploit the synergies that can be utilized with their existing client base. As also stated in the interims: " we remain hopeful that the technical issues delaying the process will be resolved shortly." Having spoken to a member of their BoD recently, he reaffirmed that the delays are due to technicalities and are not related to any issues of principle. The company has plenty of further growth potential, a very strong balance sheet and a new growth area for incremental revenue and income streams next year once the ABS license is finally granted. They have never come to market for any additional funds since the IPO and have enough free net cash available to fund any likely acquisition that may present itself in order to accelerate their legal services opportunities. The increase in the share price continues to be restrained by relaticely low liquidity - the total annual volume of shares traded is circa 17m or 17% of the shares in issue - which is a very low ratio for a quoted business but this primarily reflects the fact that insiders and their nomad Numis collectively still hold two -thirds of the shares in issue. That of course tends to inhibit volatility both to the upside aswell as the downside. However there is plenty of future growth potential in the share price with their existing insurance, financial and consultancy business in addition to the prospects that will materialize in legal services once the ABS license is obtained. They must also remain a potential acquisition target for a larger financial services company at some point in the future. This share remains a core stock in my portfolio and I make no apologies for my confidence and enthusiasm for it as a quality investment, now and for the future. |
Posted at 23/5/2011 17:11 by masurenguy Legal opening beckons for Abbey ProtectionRobert Tyerman 19/05/2011 October brings the long-awaited deregulation of the UK's £23bn legal services market, and it will not come a moment too soon for Abbey Protection, the AIM-quoted company that provides legal and professional fees insurance, as well as legal and tax advice, to small and medium-sized companies. Described as the law's equivalent of the 'Big Bang', which transformed the City 25 years ago, and dubbed 'Tesco law' by supporters and critics alike, the impending changes have already encouraged large consumer-oriented groups such as the Co-op to prepare to plan their own legal services and Abbey is determined to grab its own share of the action. Chris Ward, managing director and 15.7% shareholder of London-based Abbey, which recently revealed a 9% pre-tax profit increase to £9.6m on turnover up 6% to £35m, says the company has also taken an option to buy a small, two-partner law firm to complement the efforts of the 60-plus lawyers it already employs. Abbey, which plans to develop its thriving legal and tax consultancy activities further, will not seek to take on the big law firms in areas such as corporate finance, but aims to build on its existing strengths, expanding its services from advice and employment concerns to the full range of county court issues, including litigation between customers and suppliers. According to Ward, 'the big areas' for Abbey will be work now handled by high street law firms and possibly work outsourced by some of the big City law firms. 'We shall do dirty litigation for small and medium-sized companies,' he suggests, 'but we won't get involved in complex areas like intellectual property and patents.' Strategy Such an expansion would fit in well with Abbey's existing mix of services and plans for the future. The company, which derived £20.3m of its turnover last year from intermediary, advisory and other income and £14m from insurance premiums, provides its clients in the smaller company sector with cover for employment tribunal costs and offers individuals cover for the cost of tax investigations as well as business-to-business litigation. Abbey, keen to avoid the volatility of Lloyd's premium rates, underwrites the risks itself in partnership with the fully listed BRIT insurance group, and its in-house Ibex arm reinsures them through a carefully worded and annually renewed binding authority with BRIT, in the process making £4.6 million last year, up 10% and contributing almost half of Abbey's overall profits. Ward looks at the company's overall results for last year with 'quiet satisfaction' and says he is pleased with progress in the first quarter of 2011. In an environment of austerity, belt tightening and even collapse among smaller companies, Ibex managed to avoid any significant impact from recession-led employment claims thanks to prudent risk management controls, with a 'most pleasing' fall in employment-led claim notifications during a year in which employment tribunal claims nationally showed an increase of no less than 56%. In competitive market conditions, the company had to reduce its premiums to some extent, but kept them at levels adequate to cope with a potential claims upturn. According to Ward, that stance cost Abbey some business, but he says some of that is now starting to come back from clients dissatisfied with the service provided by some of the company's more aggressively rate-cutting competitors. Abbey's legal and tax divisions and Ibex together provided 96% of last year's profits and 88% of turnover. The tax side faced particularly strong competition, as practitioners vied for business while an unexpected reduction in tax inquiries by Her Majesty's Revenue and Customs reduced customer demand, though Abbey still achieved a 96% renewal rate for its core fee protection product and won £700,000 of new business. Now, reports Ward, the taxman is 'back on track', with inquiries rising again just when last year's pain has weeded out the weaker competition and with it the downward pressure on rates. One business area that scored last year was specialist consultancy, including tax planning insurance and capital allowances cover, chiefly for accountants, which boosted revenues 145% to a still-modest £1.1 million. Colin Davison, Abbey Protection's chief executive, says this division is looking to expand by introducing new products for its accountancy clients. In its legal fees insurance business Abbey has been facing increased demand, showing the counter-cyclical features of its business. Some of the clients for this service, such as the Federation of Small Businesses, did not generate growth, with static membership, which Ward suspects might now fall as companies fold and start-ups hang back. However, Abbey has made up for this by targeting smaller affinity groups, where there are regulatory issues and disciplinary inquiries. Ward singles out optometrists and swimming coaches as examples of groups for which the company can arrange 'bespoke cover'. Elsewhere, cyclicality did not work altogether to Abbey's advantage, with the company's legal advice centre suffering a tailing-off of calls to 'pre-recession levels', but it reacted by cutting staff numbers, winning nearly £1m of new sales and pushing pre-tax profits up 11% to £2.2m on revenues 6% ahead to £9.6m. One field in which the company has been active is 'after-the-event' insurance, which clients take out once legal proceedings involving them are contemplated after something has happened to provoke this. Abbey successfully launched a new commercial after-the-event insurance, generating initial sales of £600,000, but this division's contribution to profits was static, because of the ending of run-off contracts to administer old policies taken on in 2003 but mostly expiring in 2009 and 2010. The whole after-event sector is in a state of uncertainty following the government's acceptance of Lord Justice Jackson's Review of Civil Litigation Costs. Among many recommendations, the review envisages preventing successful claimants in civil cases from recovering their after-the-event premiums from defendants. Some in the business argue that the Jackson review sounds the death knell for after-event insurance in Britain. However, Davison, while accepting that the government response to the consultation exercise launched after Jackson reported will mean 'significant rule changes', maintains that 'we remain ready to adapt our insurance product accordingly'. The company, which ended last year with cash down from £29.6mn to £18.9m, has grown through acquisition and remains determinedly acquisitive. But, as Ward explains, apart from one modest deal last year, of late it has not clinched the takeovers it identified, either because on closer inspection they have turned out to be 'poorly run' or because the owners wanted too much for them. Abbey is still looking. Ward suggests the continuing ramifications of the recession may provide welcome fallout in the shape of 'fire sale opportunities'. Management Tony Shearer, an accountant and Elvis Presley fan who headed merchant bank Singer & Friedlander before its takeover by Iceland's ill-fated Kaupthing bank in 2005 and blamed regulators for the subsequent debacle, chairs Abbey Protection, with Colin Davison, another 15.7% shareholder, as chief executive. Davidson founded the original Abbey Tax Protection component of the company in the 1990s and became chief executive officer of the whole group in 2004 after a management buy-out of the original majority shareholding. Davison brings experience gained during a six-year stint with the old Inland Revenue to handling tax matters on the other side of the fence. He and Shearer masterminded the company's AIM float in 2007. Chris Ward joined the Abbey Legal Protection side of the business in 1996 after 17 years in the insurance industry. He spent much of that time with the Prudential, where he became London market casualty account manager, heading the professional indemnity and contingency accounts. Now, Ward is responsible for all aspects of Abbey's legal business divisions with gross premiums of more than £24m. He has overseen the development of the company's legal services and after-the-event operations, as well as the establishment of Ibex. Finance director Adrian Green joined Abbey in 2006 after gaining wide experience in general insurance underwriting and broking. Following seven years with Belgian insurer Fortis, in 1997 he joined Folgate Insurance, where he became finance director in 2002 and, after another insurer, Towergate, bought the company, he managed the run-off of Folgate's business before becoming regional finance director for Towergate. Prospects Shearer says Abbey expects to increase revenues and profits further this year, though he foresees challenges in most of its areas of operation, as clients face tougher trading conditions, with pressures on their employment levels and income. While maintaining its quest for suitable takeovers and hoping potential vendors have adjusted their expectations to today's reality, he looks forward in particular to legal deregulation later this year. 'We are well positioned to take advantage of the opportunities in this market,' he declares, pointing out that Abbey's plans are well advanced for the expected granting of the first licences in October. As Ward and Davison stress, the company will not try to be all things to all people in legal services nor to take on the big City solicitors at their own game of corporate finance, but, rather, to focus on those areas of law that will be most useful to its small and medium-sized company clients. House broker Numis detects 'cautious optimism' at Abbey that last year's intense pricing competition is starting to ease, as weaker players head for the exits. The consensus of City forecasts sees modest pre-tax profit increases to £10m this year, with £10.3m on the cards for 2012, for earnings of 7.4p and 7.7p a share respectively. But how successful Abbey's planned move into legal services proves to be will have a major potential impact on profit prospects. And, if the company does find a suitable acquisition at the right price, that too could have a significant medium-term impact on the bottom line. Valuation Since its 2007 AIM float at 55p a share, Abbey has hardly been a stunning AIM performer. Over the past year, the shares, which are fairly tightly held, have traded in a narrow range between 76.5p and 85.5p and now change hands at 80.25p, for a hardly demanding prospective price-to-earnings ratio of 10.8. The pace could quicken if the company succeeds in both its legal and acquisition strategies. Moreover, in today's yield-conscious markets, Abbey's progressive dividend policy should win it friends. The company has upped its full-year payout 8% to 4p a share, for a historic yield of 5%, more than three times current banks' base rate. Analysts suggest a possible increase to 4.28p this year, for a prospective yield of 5.3% a share and if Abbey really still cannot find an appropriate takeover at the right price or if it finds only a relatively modest one, Ward suggests 'we may return some of our cash to shareholders', including himself and Davison. On a medium- to long-term view, Abbey Protection offers good value. LONG TERM BUY |
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