US private equity firm Atlas Capital has agreed to acquire British banknote printer De La Rue in a £263m ($348m) all-cash deal that will see one of the UK’s oldest listed companies in private ownership, according to a report by Reuters.
The acquisition, announced on Tuesday, values De La Rue at 130 pence per share, representing a 16% premium to its April 14 closing price. Following the news, De La Rue’s shares jumped nearly 16%, underscoring investor confidence in the deal.
For Atlas, the investment represents a classic private equity turnaround opportunity. De La Rue – established over 200 years ago – has faced a series of setbacks in recent years, including the loss of the UK passport printing contract in 2018, a public dispute with auditor EY over its going concern status, and a shareholder revolt led by activist fund Crystal Amber. Despite these challenges, Atlas sees significant value to unlock.
The company is currently in the process of selling its authentication division – a fraud prevention unit serving government clients – to US firm Crane NXT for £300m, a move that would leave the banknote printing business as De La Rue’s core asset. That sale is expected to complete next month and, according to sources familiar with the business, will leave De La Rue with net cash of approximately £100m – providing Atlas with dry powder to execute a transformation strategy.
Under the leadership of Clive Whiley, who became chair in 2023, De La Rue has already made strides in cost-cutting and restructuring. The group’s shares have nearly quadrupled over the past year, reflecting renewed optimism.
Atlas is now poised to take De La Rue private and apply its operational expertise to revive profitability. A decade ago, De La Rue operated with EBITDA margins approaching 20%, a figure that has since slipped below 13%. Atlas is expected to pursue deeper efficiency gains, potentially restoring or exceeding historical performance metrics.
Despite the secular decline in cash usage – only 20% of transactions in the UK were cash-based in 2023, according to the British Retail Consortium – Atlas appears confident in the enduring value of secure document production and in its ability to drive value through operational improvements, not just revenue growth.
The deal is expected to close later this year, subject to shareholder and regulatory approvals.
