Investment groups led by veteran financier Edi Truell are currently negotiating to acquire a significant share in De La Rue, a venerable banknote manufacturer with a history spanning 211 years.

Discussions are underway between De La Rue and Truell’s entities, Disruptive Capital GP and Pension SuperFund Capital, regarding a potential partial offering for up to 40% of the publicly traded company, with shares priced at 125p each.

Truell has expressed his support for De La Rue’s management strategy, which includes finalizing the sale of its authentication division and pursuing the divestiture of its remaining currency operations.

If realized, this offer would value De La Rue’s total worth at approximately £245 million, as per data sourced from FactSet.

The firm noted, “Approval from the Takeover Panel will be necessary to initiate this partial offer, which will also require the consent of De La Rue’s shareholders.”

This announcement, generated at the request of the panel, followed De La Rue’s release of interim results on Thursday. In the six months leading up to September 28, revenues within the currency segment, responsible for printing money for central banks worldwide, saw a decline of 16.3% to £94.9 million.

However, the order book increased significantly, rising to £251.7 million by the period’s end, up from £239.2 million at the end of March, and reaching £338 million last month, marking the highest level in over five years.

Combining results from the authentication business, the group experienced a 7.6% drop in operating profit, totaling £7.3 million. On a statutory level, losses were reduced to £6.5 million from £16.8 million.

In October, De La Rue revealed its intent to sell the authentication business to Crane NXT for £300 million and continues negotiations for the sale of its remaining currency operations with various interested parties.

The anticipated completion of the authentication sale in the first half of next year aims to enable De La Rue to settle its debts, which amounted to £109.4 million, and allocate £30 million towards decreasing its legacy pension obligations.

Clive Vacher, the 54-year-old CEO of De La Rue, who has spearheaded the company’s efforts to recover over the past five years, stated, “We are engaged in discussions with several parties regarding the potential sale of our currency business, and having a healthy cash flow is advantageous in these dialogues.”

Vacher also noted that the outlook for the currency business is now more favorable compared to the challenges encountered during the Covid-19 pandemic.

“Central banks worldwide are experiencing critically low stock levels, resulting in a strong resurgence of demand, which has exceeded our initial expectations,” he commented.

“With our efforts over the past five years, we are highly competitive in the market, achieving a win rate of over two-thirds on the projects we pursue.”

This month, the Central Bank of Libya announced a contract with De La Rue for the printing of 30 billion dinars (approximately £4.8 billion).

According to Vacher, the Bank of England, a crucial client, will be consulted regarding any prospective sale of the currency division, although the company might choose to keep it as well.

“We have received interest,” he mentioned. “However, it’s fair to say that we do not yet have any solid offers on the table.” De La Rue is not establishing a timeline for this process.

Company shares rose by 2.5p, or 2.3%, closing at 112p.