MIDAS SHARE TIPS UPDATE: Shares in our tip BP Marsh have almost doubled in just over a year
Dedicated: BP Marsh founder Brian Marsh is helping firms grow
As an 83-year-old board director, Ken Davy is unusual but he is certainly not the only octogenarian on the stock market. BP Marsh chairman Brian Marsh is also 83, as sharp as a tack, and still arrives for work between 7am and 7.15am four days a week.
His dedication pays dividends, not just for him, as a 38 per cent shareholder, but to every investor in the business.
BP Marsh invests in up-and-coming insurance firms, acquiring small stakes for up to £5 million apiece, helping these companies to grow and reaping the benefits when they are sold to larger players. Marsh has spent almost 60 years in the insurance industry and his father was in the market before him, working on the old Lloyd's of London floor in the City.
Networks are important in this industry and, with a new generation of experienced staffers, BP Marsh is well known for helping young businesses to prosper and grow.
Recent transactions prove the point. In 2019, BP Marsh bought a 30 per cent stake in new broking firm Lilley Plummer Risks for £1 million, £700,000 was repaid in 2023, and late last month, Marsh sold its holding for £21.65 million.
Earlier this year, the group completed another sale, this time for £44 million after an initial investment of just over £4 million seven years ago.
Today, BP Marsh has around £100 million on its balance sheet and has just told investors that it will be increasing annual dividend payments from £4 million to £5 million in 2026 and 2027, equivalent to 13.4p a share a year.
The group has also pledged to give shareholders another £5 million on top of any dividends paid out in 2028.
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Business is brisk. BP Marsh does not have to look for deals. Entrepreneurs come to the firm, knowing its reputation as a supportive backer of small businesses. There have been five transactions this year alone, including two last month – new Lloyd's of London broker SRT, and Volt, which specialises in energy insurance for both renewable and fossil-fuel plants.
Marsh does not take on insurance risk himself. Instead, his firm focuses on middle-men, such as brokers and underwriting agencies.
That means the company is less vulnerable to losses from events such as Hurricane Helene and Milton, which devastated parts of the United States earlier this year.
Marsh's portfolio could even benefit from these catastrophes, if they provoke an increase in commercial insurance prices.
Midas verdict: Midas recommended BP Marsh in June 2023, when the shares were £3.76. They have almost doubled since then to £7. Investors may choose to take some profits now but it would be unwise to sell out completely. Generous dividends are in store and Marsh shows no sign of slowing down. A strong hold.
Traded on: Aim Ticker: BPM Contact: bpmarsh.co.uk
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