Former Saga boss Sir Roger de Haan, who sold the over-50s specialist in 2004 for £1.35 billion, is returning to the business with fresh investment.
De Haan will pump £100 million in the company, which was founded by his father, to boost its finances amid the coronavirus crisis, and seek a further £50 million from existing investors.
Saga confirmed de Haan’s plans in a note to the stock exchange issued on Tuesday morning (1 September).
Upon completion, de Haan would join the board as non-executive chair, taking over from Patrick O’Sullivan on a three-year term.
The proposed investment has been cleared by the Financial Conduct Authority, with other approvals "at an advanced stage".
De Haan was chief executive and chairman of Saga for 20 years prior to the firm being sold to private equity group Charterhouse.
"The board unanimously considers the proposed equity raise will support the execution of its reinvigorated strategy under its strengthened management team, which it believes will return Saga to sustainable growth," said the board in its trading update.
"The board is encouraged by the progress made since the start of the year and by the resilience of the business through a time of unprecedented challenge and change and believes the current Covid-19 crisis highlights the strength of the Saga brand, its diversified business model and its direct relationship with its customers.
"The proposed equity raise is intended to strengthen the company’s financial position against the backdrop of the Covid-19 outbreak and the ongoing suspension of Travel and to better position Saga for longer-term recovery and growth."
Saga’s efforts to combat the effects of Covid-19 over the past six months have included raising additional liquidity and enacting further measures to cut costs by another £20 million a year; moving to a remote working model; minimising cost burn within its travel division; selling Saga Sapphire; and continuing to transform its cruise business, with its second new-build Spirit of Adventure due to be delivered this month.
Meanwhile, the findings of an in-depth strategy review will be published "on or around" 10 September, which it expects to include plans to "correct" under investment in its brands, data streams and digital channels "to continue to drive efficiencies and organisational and cultural change".
Saga added trading had been "in line" with expectations and its outlook disclosed on 22 June.