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Towergate sale could net founder 2bn

Towergate founder Peter Cullum could pocket up to 2bn if he takes up one of several acquisition bids made by private equity firms last week.

Cullum, who last month bagged third place in Mortgage Strategy’s Rich List of industry players, owns a 65% stake in Towergate, which he launched 10 years ago. In November last year it bought general insurance distributor Paymentshield for 180m as part of its bid to consolidate the sector.

Towergate had also planned to ac-quire independent financial advisory firms, a market Cullum has slammed for demanding excessive commissions.

Trail commission was controversially withdrawn by Paymentshield in the run-up to its acquisition by Cullum’s firm.

Towergate has appointed advisory firm Lexicon to handle the takeover bids, thought to have been made by The Blackstone Group, Charterhouse, Candover and TA Associates.

Towergate says it won’t consider offers under 3bn, despite being valued at just 1bn when it was refinanced last year. But its pre-tax profits for 2006 were up 51% to 94.4m.

If Cullum sells he has pledged to donate millions of pounds to charity.

Chief executive Andy Homer, non-executive director Paul Dyer, sales and marketing director Tony Proverbs and mergers and acquisitions director Kenny MacIver collectively own 22% of the business.

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