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(Reuters) – Private equity firm Bain Capital has agreed to buy esure (ESUR.L) for 1.21 billion pounds ($1.55 billion), in a deal that gives investors in the British insurer a 37 percent premium on the share price at the end of last week.

The insurer said its independent directors and two biggest shareholders, Chairman Peter Wood and Toscafund, supported the Bain deal at 280 pence per share. They together own 47.7 percent shares of the company.

Wood and Halifax bank launched online insurer esure.com in 2001. After a management buy-out in 2010, it became an independent company and listed in London in March 2013 at 290 pence per share.

The deal ends over two years of speculation around esure being a takeover target for U.S. private equity firms and reports of Wood trying to offload his 30.69 percent stake in the insurer.

Wood, however, told Reuters that esure had not received any other bids in the run up to the deal with Bain Capital.

“This (Bain offer) was out of the blue. Bain Capital people came to see me in Palm Beach, Florida, at the end of April, I listened to them and then we had a few informal discussions and then it became more serious,” he said.

Wood, 72, is set to earn 371 million pounds from the deal, according to Reuters calculations. He has agreed to continue as chairman of esure.

Wood added that Bain’s offer to buy esure without planning material job cuts or major reorganisation was a “very attractive” prospect.

“It is very good for all my colleagues, all the employees because Bain Capital are going to grow the business and invest heavily,” he said.

The company employs 1,850 at offices in Reigate, southern England and in the cities of Manchester and Glasgow. Bain does not intend to shift esure’s headquarters from Reigate, the insurer said.

Bain on its part, cited esure’s “nimble and focused approach, lean structure and strong use of technology”.

NEW HEAD SOUGHT

esure’s stock had soared more than 30 percent on Monday after the insurer said it was in advanced talks over a possible bid from Bain Capital.

Wood ruled out counter-bidders, citing the stock’s price jump. The stock was trading 3.9 percent higher at 277.5 pence at 0920 GMT on Tuesday but is below levels at which it traded at the end of June 2017.

esure, which launched Sheilas’ Wheels – a female-focused insurance brand – in 2005, vies with firms such as Aviva (AV.L), RSA (RSA.L), Direct Line (DLGD.L), Hastings (HSTG.L) and Admiral (ADML.L) in the competitive British car insurance market.
“Given the headwinds facing the smaller challenger UK motor companies in a subdued pricing environment, we see this as an attractive valuation multiple,” UBS analysts said.

Wood said esure was still on the lookout for a new chief and he had shortlisted two external candidates to replace Stuart Vann, who stepped down abruptly in January.

The insurer also reported a 20 percent drop in first-half pre-tax profit, hurt by claims related to a spell of extreme winter weather in the country earlier this year.

Deutsche Bank advised the insurer on the deal, while Goldman Sachs International, Dean Street and Cenkos were financial advisers to Bain Capital.