LDC (formerly Lloyds Development Capital) has sold its stake in Squaregain Limited, a UK execution only share broker, to the French online retail broker Boursorama SA for £51.2m. This represents an IRR of 288% and a capital gain of more than £14m for LDC, which backed the business in a management buyout from comdirect bank AG in June 2004 for €16.5m (c£11.4m.)
Investing alongside LDC was Numis Corporation plc. Post acquisition the business, known as comdirect Limited, was renamed Squaregain Limited. Squaregain’s headquarters is in Docklands, East London and is the market leader in the covered warrants market and it serves a range of third parties including investment managers, banks and share registration companies in addition to its own customer base. The firm was originally launched in 2000 but was sold by comdirect bank AG as part of its strategic realignment to focus on its core market in Germany.
Andy Ball, regional director of LDC, led the investment, which was an off market transaction originated by LDC, as well as the exit. He said: “A number of exits were considered, however a trade sale to Boursorama represented the best outcome for all shareholders.”
LDC was advised by KPMG Corporate Finance and CMS Cameron McKenna.