Southampton: Prudential buys Red Funnel for £200m

Red Funnel, the ferry operator, has been sold in a deal worth a reputed £200 million.

The Board of Red Funnel has announced that its institutional shareholders have completed the sale of their share capital in Red Funnel to Infracapital Partners – the infrastructure fund of the Prudential Group.

Tom Docherty, managing director, Colin Hetherington, commercial director, and Richard Scott, finance director, have joined the Board of the new holding company. Senior management remains unchanged and will continue to hold a significant equity stake in the business.

Docherty said: “We are delighted that Infracapital have succeeded in their acquisition of Red Funnel and consider their long-term intentions as new owners of the business to be highly compatible with the plans that the team here have developed for the future. We look forward to working with the team at Infracapital in delivering our exciting plans for the future and for ensuring that Red Funnel is viewed as the first choice for cross-Solent travel."

Ed Clarke, director of Project & Infrastructure at Prudential M&G, manager of Infracapital Partners LP, said: “Red Funnel represents a valuable strategic addition to our infrastructure portfolio. As long term investors we are attracted to Red Funnel’s established high quality business, growth potential and strong management. Given the essential nature of the infrastructure owned and operated by Red Funnel, the continuing provision of a reliable high quality service to commuters and other ferry passengers between Southampton and the Isle of Wight is central to our long term vision.”

Red Funnel’s shareholders also benefited from the expertise of Grant Thornton and Lamport Bassitt, two respected Southampton firms.

Simon Davies, Corporate Finance Partner at Grant Thornton Southampton, who worked on the transaction, commented: “The local base of the deal advisory team and our relationship with Management was key in achieving such a quick deal, and in delivering the level of service required by the team. We were delighted to work in partnership with them to achieve a great deal for such a strong local business.”

Sean Kelly, head of Corporate at Lamport Bassitt, said: “It was a pleasure to work again with the Red Funnel Management Team. Lamport Bassitt have been fortunate to have been involved on a number of the major deals in the area over the last three years and hope that this continues.”