Under pressure: Boss Matt Moulding
Shares in The Hut Group (THG) soared amid speculation it is being circled by private equity suitors.
US-based buyout companies Advent International, Leonard Green & Partners and Apollo are considering a buyout, according to reports.
Shares jumped 18.6 per cent, or 21.2p, to 135.4p, valuing the online retailer at £1.65billion.
Insiders said executives from Advent recently visited THG’s offices in Manchester.
The report, by City blog Betaville, also claimed that Apollo was visiting THG this week. Advisers at Jefferies are said to be working for THG on a deal with the private equity firms, who could be working as a consortium.
This won’t be the first time Advent had snapped up a London-listed firm, having controversially bought defence giant Cobham for £4billion in 2020.
THG sells skincare, make-up and supplements and its brands include Lookfantastic and Myprotein. Its main divisions are beauty, nutrition and its tech arm Ingenuity.
Sources told Betaville that THG founder and chief executive Matt Moulding could be working with the private equity firms on a leveraged buyout to take the group private.
Others claimed the private businesses could be working up plans to buy parts of THG’s business.
It comes months after Moulding, 49, said he regretted listing the company in London, saying the process had ‘just sucked from start to finish.’
The billionaire also hinted he could take THG private if its share price performance did not improve.
It was seen as the darling of the stock market when it listed in September 2020 and was the biggest London IPO since the Royal Mail in 2013.
The company jumped 25 per cent from its 500p offer price on its first day.
But shares in the group have fallen over 80 per cent over the last year amid a series of questions over its governance and the value of its tech business.
Moulding has also drawn criticism for his role as the group’s chief executive, chairman and landlord.
He was also forced to give up a ‘golden share’, which gave him the power to block any takeover attempts in the group.
Yesterday was THG’s best day on the stock market for months.
But despite the jump, the business is still valued at just over a quarter of what it was when it floated.
THG also remains under intense pressure from short-sellers – traders that bet that a company’s share price will keep falling.
Early last month it was revealed that the value of shares held by short-sellers had hit £110m as they rushed to cash in on its tumbling stock price.