Saga Holdings Limited, the leading provider of products and services to people aged 50 and over in the UK, announced that it has appointed Close Brothers to assist in exploring future ownership options for the business, which could lead to a possible Initial Public Offering or a sale in the second half of 2007. Any deal is expected to value the company at £2.5bn, which will land its 2,500 staff, who own 20% of the business, a £500m windfall.

Saga has seen considerable development since 2004, when it was the subject of a £1.35bn management buyout backed by Charterhouse, who are set to make a sizeable return on their investment. 

Saga has achieved strong growth in its core markets, especially in motor and home insurance, and cruise holidays where it has increased its own fleet from 1 to 3 ships. 

The business has continued to add new services to its growing portfolio of specialist offerings for people aged 50 and over, including a new holiday and cruise programme under the "Spirit of Adventure" brand, a service for buying holiday or retirement homes overseas, health clubs (in a marketing venture with David Lloyd Leisure), and new financial products including equity release and long term care funding. 

Saga Chief Executive, Andrew Goodsell, said "Saga has made excellent progress in the period since the management buyout. We are well ahead of expectations, and consistently outperforming our business plans. The management team and Charterhouse agree that this is an appropriate time to consider the best future ownership structure to allow the company to maximise its growth potential."

"There was great interest in an IPO in 2004, though our outgoing shareholder decided not to pursue a float at that time. It is too early in the process to predict the outcome this time, but we will be making further announcements in due course."