Yahoo Finance Innovation Group In £500m Carlyle Bid Talks
Innovation Group (Other OTC: INVGF - news) , a London-listed software provider, is in advanced talks about a takeover by the US buyout firm Carlyle that will value it at around £500m.
Sky News can reveal that discussions between Carlyle and Innovation about a 40p-a-share takeover have been taking place for several weeks, with an announcement likely to be made later on Friday.
City sources said the deal was expected to be backed by a number of Innovation's largest shareholders, including Henderson Global Investors.
The company provides motor and property claims process services, enabled by specialist software technology that it also sells on a standalone basis.
A takeover would cap a significant turnaround for investors who have stuck with Innovation since it was valued at approximately £50m just over six years ago.
It (Other OTC: ITGL - news) will also provide a stark contrast with the fortunes of Quindell (Xetra: M6FA.DE - news) , another business process outsourcing provider which has had a torrid year culminating in the launch of an investigation by the Serious Fraud Office.
Innovation was founded by Rob Terry, who later went on to set up Quindell but who suffered similarly ignominious exits from both companies.
He was ousted from Quindell last year amid doubts about its accounting practices that a new management team has only recently been able to start allaying.
Innovation Group, which employs more than 3000 people in the UK, Europe, North America, Asia and South Africa, counts 15 of the top 20 insurance markets among its clients.
The company is run by Andrew Roberts, who is expected to reap a multimillion pound payout from the takeover.
Shareholders are unlikely to begrudge Mr Roberts his windfall, however, given the plaudits he has earned for his role in engineering Innovation's improved performance.
Carlyle's interest in Innovation is understood to have been sparked by its ownership of the RAC (Taiwan OTC: 2237.TWO - news) , the roadside recovery service, where telematics are playing an increasingly important role in the motor insurance industry.
Innovation's shares were up by just under 1% in morning trading on Friday, valuing the company at just over £430m.
Over the last 12 months, the shares have risen by about 20%.
Investec (LSE: INVP.L - news) is understood to be advising Innovation on the talks with Carlyle, which is said to be working with bankers at HSBC on the takeover plan.
A so-called take-private of Innovation would be the latest in a string of such deals involving private equity firms.
In recent weeks, the property developer Quintain and Chime Communications (LSE: CHW.L - news) , the marketing services group, have both announced takeovers by financial investors.
Innovation and Carlyle both declined to comment on Friday morning.
