All aboard! Activist investor snaps up stake in Saga as cruise business booms
- Over-50s group backed to become 'multibillion pound company'
Shares in over-50s group Saga hit a four-and-a-half-year high after an activist investor snapped up a £1.5million stake – and said it can once again become a ‘multibillion pound company’.
In a vote of confidence in the travel and insurance firm, Kelso Group Holdings bought 400,000 shares at an average price of 386.5p each, giving it a 0.3 per cent holding.
Kelso also submitted proposals to the Saga board aimed at boosting its value – including attracting investors from the US – as it focuses on its fast-growing ocean and river cruise business.
The investor praised the Saga management team – including Sir Roger De Haan, who returned as chairman in 2020 and underwrote a £150million loan having run the firm for 20 years before selling it to private equity in 2004 – and noted that debts are falling and profits rising.
‘Saga appears to be in very solid hands,’ it said. ‘With the clear strategic focus, debt falling and profits rising, Kelso believes that now is the right time to invest in Saga.’
Saga has benefited from strong demand for cruises among the over-50s
Saga shares rose almost 8 per cent to as high as 413.5p – giving it a value of £599million.
The stock gained 225 per cent last year – meaning it more than tripled in value – but remains down nearly 90 per cent from its peak a decade ago.
The company was valued at £2.1billion when it returned to the stock market in 2014.
‘We believe Saga has the ability, with its focus on travel with ancillary financial services, to return to being a multibillion pound company,’ said Kelso chairman Sir Nigel Knowles.
‘Saga's management have done an excellent job turning Saga around in the last five years and materially reducing the debt while growing profit.
‘The importance of Sir Roger De Haan's personal backing through significant equity and loan commitments during those hard times should not be forgotten.’
Kelso, which also holds stakes in cybersecurity firm NCC Group, online retailer THG and fishing tackle seller Angling Direct, described Saga as ‘a proven and trusted brand selling into the UK over-50s demographic which Kelso believes is a highly attractive segment’.
And it noted Saga’s market capitalisation recently exceed its debt levels for the first time in five years.
In a statement, Kelso added: ‘Despite a strong share price in 2025, we believe there is significant upside from here when compared to peers. As the share price improves, we also note the potential for the company to return to the FTSE 250 in 2026 and the likely consequential buying demand from index funds.’
Announcing first half results in September, Saga reported a 9 per cent rise in revenue to £328.2million and profits of £3.7million having made a loss of £116.9million in the same period the previous year.
It also said its debt burden had fallen to £515.1million from £617.2million.
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