FTSE 250 movers: Bridgepoint surges on ECP deal; WH Smith out of favour

(Sharecast News) - Bridgepoint announced the acquisition of most of Energy Capital Partners in a cash and share transaction to create a €57bn global private markets asset manager.

Group chairman, William Jackson, said: "We have a high bar for strategic M&A, and ECP is one of the few platforms we have identified which clearly surpasses it, both from a strategic and financial perspective.

"As well as the compelling financial rationale for the transaction, Bridgepoint will benefit from the investing expertise of the ECP team, while at the same time there are significant opportunities for both of us to work together on initiatives such as adding adjacent strategies and expanding geographically."

The private equity investor said that it would pay out £233m in cash and a further £423m in newly issued Bridgepoint shares, for a total enterprise value of £835m.

ECP's existing debt stood at £179m.

More specifically, Bridgepoint said it was acquiring 95% of ECP's Fee Related Earnings with Sumitomo Mitsui retaining the remainder.

It was also purchasing as much as 15% of the carried interest in more recent historic funds and at least 30% of future funds.

That was alongside half of the GP co-investments in more recent historic funds and at least 65% of GP co-investments for future funds.

The sale was expected to be accretive to Bridgepoint's shareholders in EBITDA and net income terms from the day of closing.

Bridgepoint added that following the transaction it would split its roles of chairman and chief executive officer.

William Jackson would continue to chair the private equity operations while Raoul Hughes, a group managing partner, would assume the role of group CEO.

The company also announced that it would launch an additional £50m share repurchase program once the existing one had been completed "given the attractive fundamental value and prospects of the company".

Food company Bakkavor on Wednesday lifted full-year guidance as higher prices and volumes in China helped it post a rise in profit and revenue for the half-year

The company on Wednesday said that with positive momentum expected to continue, it saw 2023 adjusted operating profit "at least in line" with the prior year's of £89.4m, around £4m ahead of current consensus.

Reported revenue rose by 7.9%, to £1.09bn, while adjusted operating profit was up 2.1%, to £43.4m.

"Our continued market share gains in the UK reflects our consistent delivery for customers and demonstrates that our broad product range continues to meet the needs of shoppers during the cost-of-living crisis," said chief executive Mike Edwards.

"We are confident in delivering an upgraded full year performance, with adjusted operating profit now anticipated to be at least in line with last year and ahead of current market expectations."

"This is underpinned by the execution of our restructuring, which is driving performance and synergies across the business ahead of our expectations. I am also pleased that we now have momentum building in all three regions, which is positive as we look forward."

Ashmore reported a fall in annual profits as assets under management (AuM) declined 13% as customers withdrew their cash amid volatile markets.

Pre-tax profit was down 6% to £111.8m, but offset by higher interest earnings as central banks hiked rates to combat inflation while AuM came in a at $60bn, with the movement attributable to net outflows of $11.5bn.

Stationery and books retailer WH Smith said its full-year figures will be in line with expectations as strong trading in at its airport and train station locations offset a weak performance on the high street.

The company, which operates over 1,700 stores worldwide of which 523 are on the UK high street (at last count in February 2023), said group revenues for the year ended 31 August were up 28% year-on-year, rising 18% on a like-for-like basis.

Travel sales, which last year accounted for two-thirds of group revenue, were up 42% (+27% LFL), though first-half growth of 75% was tempered by a lesser 23% rise in the second half.

The company pointed out that the previous financial year was impacted by the Omicron variant, which had hit travel activity in the first half but led to a strong rebound in the second.

UK travel saw 36% growth, helped by a strong peak holiday season for air passenger numbers, while North America travel sales rose 31%. Rest of World travel sales, however, surged 98%, helped by 30 additional stores during the period.

WH Smith's high street business experienced a full-year sales decline of 1% (+1% LFL) but was said to have "performed well and in line with expectations".

The company said its strategy for the high street division remains unchanged "as we continue to focus on cost efficiencies and the return on space".

Looking ahead, WH Smiths expects to open 40 new stores in North America in the current financial year, as well as 25 in Rest of World and 15 in the UK Travel business.

Market Movers

FTSE 250 (MCX) 18,503.15 0.06%

FTSE 250 - Risers

Bridgepoint Group (Reg S) (BPT) 188.90p 8.00% International Distributions Services (IDS) 251.50p 4.14% Bakkavor Group (BAKK) 102.00p 3.03% Balanced Commercial Property Trust Limited (BCPT) 70.40p 2.47% Empiric Student Property (ESP) 88.60p 2.43% Ashmore Group (ASHM) 196.80p 2.34% Grainger (GRI) 237.40p 2.33% Quilter (QLT) 87.35p 2.22% Babcock International Group (BAB) 394.40p 1.96% C&C Group (CDI) (CCR) 136.20p 1.95%

FTSE 250 - Fallers

WH Smith (SMWH) 1,381.00p -6.94% Ferrexpo (FXPO) 75.80p -4.77% Energean (ENOG) 1,131.00p -4.40% Digital 9 Infrastructure NPV (DGI9) 58.40p -3.95% Marshalls (MSLH) 262.40p -2.81% easyJet (EZJ) 423.20p -2.80% Aston Martin Lagonda Global Holdings (AML) 337.40p -2.77% Capita (CPI) 16.69p -2.51% Future (FUTR) 753.50p -2.46% Wizz Air Holdings (WIZZ) 2,145.00p -2.37%