CBG

Insurance broker and financial services specialist CBG Group has raised £1.65m at 120p in today’s tough market conditions to fund growth and acquisitions.

The Manchester-based company, whose growth has already been fuelled by takeovers, has secured this new funding in a placing with institutions through Zeus Capital and Religare Hichens, Harrison. AIM-quoted CBG, which recently negotiated increased banking facilities with Royal Bank of Scotland, says it will use these and the placing proceeds to expand the business organically and seek any suitable acquisitions in insurance broking.

Chairman Laurie Turnbull claims that institutions’ willingness to increase their holdings in CBG in the midst of current financial markets turmoil ‘is a testament to our proven successful track record’. Acquisitions helped the company increase pre-tax profits 48 per cent to £930,000 in the first half of this year.

Floated at 36p in 2003 and recommend by Growth Company Investor the following year at 42.5p, CBG shares reached 191p last December, after GCI suggested partial profit taking at 142.5p, before entering choppier waters. Now 137p, valuing the company at £19.3 million, they should outperform several peers at a time of likely sector consolidation and are worth holding on to for eventual improvement.

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