The founder of THG PLC has given up his much-publicised special share ahead of the company’s annual general meeting today.
The planned move means CEO Matt Moulding loses the power to veto hostile takeovers at Manchester-headquartered THG, but should now be able join the FTSE 250 premium segment of the London Stock Exchange.
THG said the timing of the move would be subject to the final outcome of the Financial Conduct Authority’s review for reform of the listing regime.
Following corporate governance criticism from the media and the city, last year Moulding gave up his chairmanship of THG – appointing Charles Allen, Lord Allen of Kensington CBE, as non-exec chair – to focus on the CEO role.
THG’s share price has fallen from around 800p at IPO in January 2021 to around 77p at the time of writing. The company was the subject of a failed takeover approach from private equity giant Apollo in April and May which saw its shares jump then plummet.
Moulding, who has become extremely vocal on LinkedIn – criticising the press, big business and London Stock Exchange – reflected on the approach last month.
“Just about every major PE firm has enquired about taking THG private,” he said. “PE firms usually want majority ownership. We’ve been clear: don’t bid if you want 51 per cent, plan to use debt to leverage up, or won’t allow existing shareholders to stay invested. This rebuffs most PE firms.
“Yes, it’s unpleasant being listed in London. But I’ve spent 20 years building THG, from an idea while sat on my sofa, into a global group with sales of £2.2bn. We’ve just completed a vast expansion of our tech and global infrastructure. We’re just getting going.
“It’s well known that PE deals are lucrative for management. THG would be worth billions more away from the daily market manipulation involving bankers, hedge funds and pundits.
“Like with all previous bidders, the Apollo bid wasn’t right for THG. Yes, it allowed existing shareholders to stay invested, with me continuing to run the group. But Apollo also wanted PE controls, particularly across beauty and nutrition where they asked for controlling equity rights.
“And so, the Apollo bid was based upon smart financial engineering, capitalising on a wildly low share price from THG being on the LSE. I get excited about building and growing things, not spreadsheets.”
Meanwhile THG said it expects to report adjusted EBITDA in the range of £44-£47m for H2 2023, compared with £32.3m in the prior year. It also revealed the addition of Helen Jones as an independent non-executive director, while Iain McDonald will step down from the Remuneration Committee to focus on his Sustainability and Nomination Committee commitments.
Jones currently serves as the chair of the remuneration committee at Premier Foods plc, Virgin Wines plc and Fuller, Smith and Turner plc, and sits on the audit committee at the latter two companies. She also holds the role of senior independent director and is a member of the audit, nomination and remuneration committees at Halfords Group plc.
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